INTERNET

“This ruling clears the way for a fair and level playing field where all retailers compete under the same salestax rules, whether they sell merchandise online, in-store or both,” said Matthew Shay, president and CEO of the National Retail Federation.

“We’re pretty excited,” said Gordon

M. Gough, president and CEO of the Ohio Council of Retail Merchants. “We think the court made the right decision.”

The court’s decision is welcome relief for “the impoverished retailers in Columbus, along with the rest of the state,” said Jack Seibert, an Upper Arlington goldsmith and jeweler. “We’ve been at a disadvantage for quite a long time.”

The ruling is a victory for big chains with a presence in many states

because they usually collect sales tax on online purchases already. Now, rivals will be charging sales tax where they hadn’t before.

Some of the big chains have a physical store in the state that is the purchase’s destination. Amazon. com, with its network of warehouses, also collects sales tax in every state that charges it, although third-party sellers who use the site don’t have to.

Until now, many sellers that have a

physical presence in only one state or a few states have been able to avoid charging sales taxes when they ship to addresses outside those states. Online sellers that haven’t been charging sales taxes on goods shipped to every state range from jewelry website Blue Nile to pet products site Chewy.com to clothing retailer L.L. Bean.

Sellers that use eBay and Etsy, which provide platforms for smaller sellers, also haven’t been collecting sales taxes nationwide.

Writing for the majority in the 5-4 ruling, Justice Anthony M. Kennedy said states lost tax revenue of between $8 billion and $33 billion a year since the original ruling on internet sales more than 25 years ago.

The current case involved a 2016 law passed by South Dakota that said it was losing out on an estimated $50 million a year in sales tax revenue not collected by out-of-state sellers. Lawmakers in the state, which has no income tax, passed a law designed to directly challenge the physicalpresence rule.

Kennedy singled out Wayfair, an online retailer of home goods and furniture. “Its advertising seeks to

create an image of beautiful, peaceful homes, but it also says that ‘one of the best things about buying through Wayfair is that we do not have to charge sales tax,’” he wrote. “What Wayfair ignores in its subtle offer to assist in tax evasion is that creating a dream home assumes solvent state and local governments.”

In 2009, the Ohio Council of Retail Merchants commissioned a study by estimate how much revenue the state was losing out on through online sales.

“They pegged the loss at $200 million in sales tax revenue,” Gough said. “While we know that many major online retailers are collecting sales tax, the number of online transactions has grown by 20 to 25 percent a year. So it’s really hard to peg how much more the state is losing out on tax revenue today.”

Before Ohio can begin to collect tax revenue, however, the state’s laws must be changed, said Gary Gudmundson, communications director at the Ohio Department of Taxation.

“Today’s decision does not have an immediate, direct impact on Ohio,” he said. “The court ruled on the laws in another state, not on Ohio’s tax laws.”

The losers in this ruling are companies that exist only online, said Jack Stewart, senior manager in the state and local tax practice for accounting firm Schneider Downs.

“The question is what is the (minimum) amount of (sales) activity you can have” before an online business has to collect sales tax, Stewart said. “They’re not putting a lot of guidelines out there. It’s going to really add to the confusion.”

Guidelines at the federal level are definitely needed, said Tony Ehler, a partner in the Columbus office of Vorys, Sater, Seymour and Pease and the cochair of the law firm’s probate and tax group.

“I also remain concerned that (the decision) will encourage and promote remote foreign vendors (outside the reach of state tax authorities) at the expense of all domestic vendors,” Ehler said.