In a ruling that may impact cord cutting the United States Supreme Court in a 5-4 decision said that states can collect sales taxes online. Justice Anthony Kennedy wrote the 5-4 decision, joined by Justices Clarence Thomas, Ruth Bader Ginsburg, Samuel Alito and Neil Gorsuch. Chief Justice John Roberts dissented.
The idea of online taxes for a long time was limited to companies who had a physical presence in that state. Recently that has been expanding with States pushing to get sales taxes on sales even when the company does not have a physical presence in that area. Recently that has broadened to taxes on services like Hulu, Netflix, and Amazon Prime.
Chicago was one of the first areas to impose a so-called Netflix tax but other states and towns have started to tax streaming and video services. This ruling could help clear away any legal objections to taxes like Chicago’s Netflix tax.
Taxes on TV services is not new. Many cable TV packages come with over $10 in government-imposed fees and taxes. Well, most streaming services taxes are there they are far less than what you would pay with a cable TV package.
With this ruling look for more states and local governments to push for taxes on online physical and digital sales.
Source: AP
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