Some Supreme Court justices are sounding concerned about doing away with a rule that has meant consumers don't get charged sales tax on some online purchases.
The case on Tuesday focuses on businesses' collection of sales tax on online purchases.
The Supreme Court has addressed this issue over the years, eventually ruling that merchants with a physical presence in a state must collect that state's sales tax when selling to a resident of the state.
The Supreme Court is focused on an appeal by South Dakota after the state Supreme Court in that state determined that it would be illegal for the South Dakota to collect tax from retailers who don't have a presence in the state, said Jeffrey Johnson, a Department of Revenue spokesman.
Several justices anxious that allowing states to reach outside their borders to collect sales taxes could create messy legal questions and endless litigation.
"This is a very prominent issue which Congress has been aware of for a very long time and has chosen not to do something about that", Kagan said.
Brann and Isaacson partners George Isaacson, Martin Eisenstein and Matthew Schaefer will represent online retailers in a case about whether those companies have to collect state sales tax. Those collections come under existing laws that only require companies to collect sales tax if they have a physical presence in the state. Those businesses must either begin collecting sales tax or send a notice to all buyers that they are supposed to pay tax.
Large retailers such as Apple, Macy's, Target and Walmart, which have brick-and-mortar stores nationwide, generally collect sales tax from their customers who buy online. Justice Stephen Breyer put it slightly differently. A new ruling, and the laws that would follow, might hit these smaller sellers with new costs, forcing them to raise their prices while losing revenue.
Enzi said the 1992 decision in Quill Corp v.
"You say that congressional action should be taken against the background in which this court has made a statement of constitutional law that has now, especially in light of the cyber age, proven incorrect", Kennedy said.
"That's why we're standing at the United States Supreme Court: to have the Court set that level playing field - for all businesses, across South Dakota and the nation".
South Dakota has passed a law requiring retailers with more than $100,000 in annual sales or 200 transactions in the state to pay a 4.5 percent tax.
The state, appealing a lower court decision that favored Wayfair Inc, Overstock.com Inc and Newegg Inc, is being supported by President Donald Trump's administration.