For more than 20 years, mail order sellers have been exempt from collecting state and local taxes on items delivered to customers out-of-state. By some calculatins, the annual lost tax revenue for the states on these sales exceeds $2 billion (5). The traditional legal anaiysis that has shielded these interstate sales from taxation has been modified by the Supreme Court and may no longer apply today. The direct marketing industry must adopt realistic policies regarding federal legislation or incur costly legal battles with state tax collectors that may lead to undesirable outcomes.
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References
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Goldberg v. Sweet, 109 S.Ct. 582 (1989).
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Land's End and Direct Marketing Association, Tax alert information (1989).
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Legislators Struggle with Mail-Order Sales Tax Bill 40 Tax notes 1336 (September 26, 1988) (no author given).
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