(Compli-beverage) - The US Supreme Court (SCOTUS) will begin hearing arguments this week in the case of South Dakota v. Wayfair, Inc., and a likely outcome is that states like South Dakota will gain the authority to compel sellers like Wayfair to remit sales tax, even if they do not have a physical presence in the state. If the Justices agree that South Dakota has the right to tax these out-of-state (“remote”) sellers, wineries will probably not see a tremendous amount of change as a result though.

At issue in Wayfair is whether SCOTUS should overturn a 1992 decision called Quill Corp. v. North Dakota that created the current standard where a state can only go after out-of-state sellers (including eCommerce businesses) for sales tax remittance if they have “substantial nexus” in that state. A simple scenario for thinking about what nexus means is one where the seller has a physical presence because of an office, a distribution warehouse, or an employee in the state. However, nexus definitions can be tricky, and states tend to define and enforce nexus differently.