OBERLIN, Ohio, April 18, 2018 /PRNewswire-USNewswire/ -- The National Association of College Stores (NACS), today issued the following statement following oral arguments heard by the Supreme Court of the United States (SCOTUS) in the case of South Dakota v Wayfair, et al. The case, which could be decided by June, will either result in equitable rules for remote sales tax collection, or continue to give out-of-state internet retailers an unfair advantage over local brick-and-mortar retailers.
"As a trade association representing non-profit and small independent businesses, we believe sales tax policy should not favor one segment of an industry over another," said Richard Hershman, Vice President of Government Relations for NACS. "This case could level the playing field by giving states the ability to enforce their existing state and local sales tax laws. For too long the tax collection avoidance being practiced by online-only retailers has put brick- and-mortar retailers, such as college and K-12 stores, at an unfair competitive disadvantage."
The current standard for remote sales tax collection did not anticipate the e-commerce explosion. The 1992 SCOTUS Quill decision came well before modern e-commerce, and has allowed online-only sellers to avoid collecting sales tax and undercut local businesses for more than two decades.
As NACS explained in an Amicus Brief with the court, Pueblo Community College Bookstore in Pueblo, Colorado has implemented price comparison tools on its own online site, providing transparency to students on textbook purchases and making it easy for them to buy from the lowest-priced source, whether that is the Pueblo Community College Bookstore or elsewhere. More than 1,200 college stores do the same thing, and several thousand additional stores price match. Yet the bookstore (and others like it) still face a drain from "showrooming," because an estimated one in four students use the sales staff to research and gather all of the books that they need, with no intention of purchasing them at the store. Because the store price matches and offers an online engine permitting students to purchase from the lowest-priced source, the sales-tax differential is plainly driving this conduct. Effectively, the Quill advantage for out-of-state sellers means the Pueblo Community College Bookstore and its similarly-situated in-state peers must pay the overhead for tax-advantaged out-of-state sellers, despite offering identical prices.
As our marketplace has evolved, this decision has done significant damage to local retailers and the jobs they support. The South Dakota case is the perfect opportunity to revisit Quill after 25 years of technological change and restore free market competition.
About The National Association of College Stores The National Association of College Stores (NACS), headquartered in Oberlin, Ohio, is the professional trade association of the campus store industry. NACS provides education and other resources that help its member stores support student success, the campus experience, and the academic missions of higher education institutions. The association represents all campus stores, which include nearly 4,000 campuses in the U.S. and Canada, and approximately 1,000 industry-related companies that supply course materials and other merchandise and services to campus stores.