South Dakota Settles with Wayfair Defendants

November 2, 2018 Alex Samuel

The State of South Dakota has entered into a settlement agreement with the companies of Wayfair, Overstock, and Newegg. The settlement effectively ends the litigation between the state and the three online retailers that refused to comply with South Dakota’s remote seller law. In 2016, the South Dakota state legislature passed legislation requiring out-of-state retailers to collect and remit sales tax similar to in-state retailers if they have more than $100,000 in sales or complete more than 200 transactions per year within South Dakota. Litigation between the state and the defendants over the remote seller law landed the parties before the United States Supreme Court which eventually ruled in the state’s favor. The settlement agreement resolves all remaining issues not addressed by the Supreme Court's ruling. Under the terms of the agreement, the defendants will comply with South Dakota’s remote seller law beginning January 1, 2019. For all other retailers who meet the remote seller thresholds, they are required to collect and remit sales taxes beginning November 1, 2018.

About the Author

Alex Samuel is a Junior Regulatory Counsel at Sovos Compliance. Within Sovos' Regulatory Analysis function, Alex focuses on enterprise sales tax issues arising in various domestic and international jurisdictions. Prior to Sovos, Alex worked as an attorney at New Hampshire Legal Assistance. Alex is a member of the New Hampshire and Massachusetts Bars, earned his B.S. from the University of Minnesota and his J.D./LL.M from the University of New Hampshire School of Law.

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