Sessions v Dimaya
The Supreme Court today has issued a ruling in the case of Sessions v Dimaya. The case had started under the Obama administration. The issue before the court was whether or not a provision of federal law that requires the mandatory deportations of immigrants who have been convicted of some “crimes of violence” was Constitutional.
With the Death of Justice Scalia, only eight justices last term had heard the case. It was announced late June that the court had decided to re-hear arguments this term. The assumption at the time was by rehearing the case this term, Justice Gorsuch could break a tie.
After oral arguments, Justice Gorsuch joined the majority 5-4 decision which ruled that the provision was indeed unconstitutional and it has now been invalidated. Full Decision: Supreme Court PDF 4-17-2018
South Dakota v. Wayfair (17-494)
At issue is a rule stemming from two, decades-old Supreme Court cases: If a business is shipping to a state where it doesn’t have an office, warehouse or other physical presence, it doesn’t have to collect the state’s sales tax.
The case now before the Supreme Court involves South Dakota. The State collects no income tax and relies heavily on sales tax for revenue. Governor Dennis Daugaard (R) has said the state loses out on an Estimated $50 million dollars a year on sales tax that’s not collected by out-of-state sellers.
After hour-long arguments this morning it appears the Justices are divided on overturning the 1992 Supreme Court ruling, that made much of the internet a tax free zone.
Three justices — Anthony Kennedy, Neil Gorsuch and Clarence Thomas — have already indicated they would overturn the 1992 ruling, known as Quill v. North Dakota.
The issue for the court is finding a fifth justice, with Justice Sotomayor indicating that she would rather leave it to Congress to overturn the Quill ruling. Chief Justice Roberts argued that Amazon’s tax collection efforts are possibly a reason to not disturb the Quill rule as they are the largest online retailer and are collecting in all 50 states. While Justice Samuel Alito is concerned that other states might be more aggressive and try to impose retroactive liability on retailers.
For more on South Dakota v. Wayfair: Court Docket
Why it Matters: Removing the Quill Rule would harm the 3rd party seller, a business that simply uses the internet to sell goods without owning a physical store. It would be on those 3rd party independent retailers to collect and report all taxes collected on out of state purchases.