Sales tax boon – or not?
It’s going to cost some people a little more to make online purchases after the Supreme Court ruled in a case involving Massachusetts-based Wayfair that states can collect sales tax on purchases by residents no matter where the seller is located.
For many states, that not only clears up confusion stemming from a 25-year-old decision that said they could only collect if a company had a physical presence in their borders but opens up a stream of revenue that they were unable to capture before.
Not so much Massachusetts, though. Nearly 80 percent of purchases made online by Bay State residents are already subject to the sales tax after the Baker administration determined last year that an “economic presence” was the same as a physical presence. The regulatory change targeted companies with more than $500,000 in sales or more than 100 transactions to collect sales tax and turn it over to the Department of Revenue. Most online retailers had already begun complying but one, Crutchfield Corporation of Virginia, sued the state, claiming it violated federal law. That action is now likely moot in the wake of the Supreme Court decision.
At the Boston Globe, Jon Chesto made the astute observation that the timing of the decision was a godsend for lawmakers who were trying to figure out how to deal with the loss of a potential $2 billion after the Supreme Judicial Court rejected the so-called millionaire’s tax ballot question. Outgoing Senate President Harriette Chandler welcomed the relief while House Speaker Robert DeLeo said he’d go back to his members to decide the next step.
Gov. Charlie Baker applauded the high court’s decision but said there would be no ramp-up in collecting sales tax, basically because it is already underway and those few who don’t collect and pay may not be required to because of their size.
The decision is also creating some problems to our northern neighbors in the Granite State, which proudly clings to its tax-free identity. New Hampshire Gov. Chris Sununu points out no one up there knows how to collect, let alone remit, sales tax because they never had to. It is, of course, the justices’ fault.
“It’s clear that none of those judges are from a low-tax state like New Hampshire because if they were, they’d know how outrageous the decision is,” Sununu told reporters. “I think it’s unconscionable that they would ask our businesses to become basically tax collectors for other states.”
The sales tax in Massachusetts is only one way for the state to collect on purchases form people who drive up north to avoid the tax man. There is also a “use tax,” which is the same 6.25 percent as the sales tax and is levied against any purchase that sales tax was not collected on but which is intended for use, storage, or consumption in the state. So that couch you bought in New Hampshire for $800 which you figured you saved $50 bucks on? You must send a check to DOR.
But the state also has a “safe harbor” for those purchase, which has stuffed a few million into the coffers over the years. Taxpayers can pay a set amount based on their income to satisfy any out-of-state purchases.
In the end, the Supreme Court said it was about equity with the reach of technology disrupting old boundaries.
“Helping (Wayfair’s) customers evade a lawful tax unfairly shifts an increased share of the taxes to those consumers who buy from competitors with a physical presence in the State,” said the 5-4 majority ruling by Justice Anthony Kennedy. “It is essential to public confidence in the tax system that the Court avoid creating inequitable exceptions.”
As another Republican leaves the party in Massachusetts, Gov. Charlie Baker touts his brand of Republicanism.
The Massachusetts Senate passed a wage theft bill. (MassLive)
A Berkshire Eagle editorial praises a bill that just passed the House that would ease the tax burden on people who inherit farm land and intend to continue farming.
Bristol Sheriff Thomas Hodgson demanded an apology from Attorney General Maura Healey after she called for an investigation into his jails over high suicide rates among inmates and allegations of civil rights abuses. (Standard-Times)
Quincy’s trash hauler which is scheduled to lose its contract July 1 is suing the city and the new trash company for breach of contract. (Patriot Ledger)
Fall River Mayor Jasiel Correia has restored the $2.3 million in revenue from the pay-as-you-throw trash pickup after city councilors rejected his more to eliminate the controversial program. (Herald News)
The Southborough Historical Commission has filed an ethics complaint against one of the town’s selectmen saying he forced a commission member out for sending an email to an area church regarding an impending development without revealing his affiliation with the church and his involvement in the project. (MetroWest Daily News)
The US is preparing to house a whopping 20,000 migrant children at four military bases. (New York Times)
Everyone is trying to figure out who the message was for from the jacket First Lady Melania Trump wore after she visited shelters that house immigrant children in Texas. On the back of the jacket was written,, “I Really Don’t Care. Do U?” (New York Times)
A bill paving the way for Rhode Island financial support for a new PawSox stadium in Pawtucket cleared a key committee and is moving toward a full vote in the House. Worcester is trying to lure the Pawsox with its own package. (Telegram & Gazette)
Massachusetts is the most left of all left-wing states. Says who? The American Conservative Union. (Boston Herald)
US Rep. Seth Moulton’s recruitment of centrist congressional candidates with military backgrounds will get a financial lift as Michael Bloomberg is committing to support at least some of them with a portion of the $80 million he is spending to Democrats in the midterm elections. (Boston Globe)
Intel CEO Brian Krzanich is ousted because of a consensual affair with an employee years ago in violation of the company’s non-fraternization policy. (Associated Press)
Story Land in Glen, New Hampshire, will be “sensory sensitive” this weekend as it turns down the volume and eliminates other surprises that can be jarring to children with autism spectrum disorder. (Boston Globe) Showcase Cinemas, the movie chain, plans to take a similar approach at some of its theaters on select screenings. (Boston Globe)
The rapid increase of baby boomers going into retirement coupled with the decline of younger workers to support them is putting a strain on Social Security and other retirement programs. (Wall Street Journal)
Six Massachusetts communities are experimenting with new ways to assess students beyond MCAS. (WBUR)
Boston Schools Superintendent Tommy Chang is sued over his refusal to disclose how often the system releases information about students to ICE. (Boston Globe)
Boston University has tapped Angela Onwuachi-Willig, a University of California Berkley professor and an expert in gender and race diversity, as the new head of the BU School of Law. (Boston Herald)
Quincy Mayor Thomas Koch said he will seek a new home for the troubled city-owned Quincy College for the “long-term success” of the school. (Patriot Ledger)
Thomas J. Kane offers up some ideas on how to rejuvenate education reform. (CommonWealth)
An old tuberculosis vaccine may be a breakthrough to treat Type 1 diabetes, according to researchers at Massachusetts General Hospital. (Boston Herald)
The Conservation Law Foundation has notified two popular upscale Harwich resorts it plans to sue them over violations of the federal Clean Water Act because of high nitrogen discharges form their wastewater treatment facilities. (Cape Cod Times) On Thursday, CommonWealth’s Michael Jonas put a spotlight on the increasingly litigious environmental advocacy group.
Massachusetts issued its first marijuana license, a milestone that’s overshadowed by the fact that recreational pot is unlikely to go on sale July 1. (CommonWealth)
Four Brockton city councilors are pushing to put a referendum before voters in November to ban marijuana sales while Mayor Bill Carpenter is pushing to bring in retail pot stores downtown. (The Enterprise)
The Massachusetts Gaming Commission gave MGM Springfield the greenlight to serve alcohol on the gambling floor until 4 a.m. (Boston Globe)
A 28-year-old man is accusing Salem Police officer Brian Butler of assaulting and raping him when he was in police custody. Butler’s attorney acknowledges his client engaged in sexual acts with the detainee. While the attorney says the acts were “unprofessional and disgusting,” he claims they were not a crime. (Salem News)
The Boston Globe dumped its bad news about the suspension of columnist Kevin Cullen late on a Friday afternoon, the exact kind of news dump the newspaper has decried in the past when pols do it. (CommonWealth)
The National Enquirer sent advance copies of stories about Donald Trump to his attorney Michael Cohen before publication. The supermarket tabloid denies the allegation. (Washington Post)
ABC is planning a spinoff of the Roseanne show without Roseanne Barr, who was cut from the network’s lineup after she posted a tweet with a racist reference to a close friend and adviser to former President Barack Obama. (New York Times)PASSINGS
Charles Krauthammer, the Pulitzer Prize-winning columnist for the Washington Post, has died at the age of 68. (Washington Post) George Will has a touching remembrance of his friend who was heading to become a doctor but broke his neck and became paralyzed while swimming at a pool at Harvard Medical School and changing his career direction to writing. (National Review)