In a seminal decision handed down on June 21, 2018, the United States Supreme Court discarded twenty-five years of sales and use tax jurisprudence by soundly rejecting the physical presence standard embodied by the Quill v. North Dakota[1] decision - a decision the Court asserted was “unsound and incorrect”. The Quill opinion had established that an out-of-state retailer must have some level of physical presence in a state (e.g., through property, activities or agents) before a state could exercise jurisdiction over the retailer and force it to pay sales tax to the state. In rejecting Quill, the Court held that physical presence is not necessary to meet the “substantial nexus” requirement set forth in the Complete Auto Transit[2] decision.
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