we'll hear argument first this morning in case seventeen four ninety four south dakota versus wayfair journal jackley mr chief justice and may it please the court there are two very significant consequences brought about by quill first our states are losing massive sales tax revenues that we need for education health care and infrastructure second our small businesses on main street are being harmed because of the unlevel playing field created by quill where out of state remote sellers are given a price advantage i'm sorry isn't the problem not quill but the fact that you don't have a mechanism to collect from consumers it's not the merchants who are playing paying the sales tax it's the consumer they're collecting it for you so find a way to collect from them just a side a more subtle sort of my are we believe that we have a right because we have a statutory scheme concerned about the very many unanswered questions that overturning precedents will create a massive amount of lawsuits about i know you've told us that bill has created its own set of lawsuits i guess every but here there are some significant ones you're not retroactive but your adversaries point out that there are many states who have already made this collection retroactive so we have that question we have questions about states who are using it and merchants can't keep track of who's they so to all of these are questions that are wrong with difficulties so you're introducing now a whole new set of difficulties to to put behind something that's been in place for thirty years now just to sort of i or we would encourage using the doctrines that are already in place with complete auto when it comes to a tax assessment to look for discrimination to look for apportionment issues to look at that substantial nexus how about economics certainly economics can be addressed by pike pike is a balancing test that this court uses for its adopt dormant commerce clause and commerce clause in fact it is able to take a look at the actual how many sales does it say you're at two hundred thousand i believe or two hundred sales or and i don't remember the monetary amount but what's the minimum in south dakota it's it's set out to two hundred i kno that it still doesn't answer the question what's the minimum everywhere else the minimum would be one sale because if you look at complete auto that creates the nexus and then it will go down into with that cost that you're going to put on small businesses the small businesses are the ones that are affected most by quill if you look at that small business on main street it is that business that is put at a price disadvantage because of quill if you look at what actually they're quitting but by the fact that there are massive discount sellers not just on the internet but even in stores now i'm talking about the added cost of doing business for the small businessman someone one of the briefs said it was a two hundred fifty thousand dollar cost to implement one of these sales programs one of the sales tax for that brief left out that it begins it's to scale wan begins at twelve dollars a month for thirty transactions when you look at the cost associated with collection it it really depends doesn't include auditing doesn't include integrating the program with the existing sales program of the company it doesn't account for the maintenance of the program there's a lot of costs that are inherent in the process of this thing and one thing to look at is the fact that all the sellers at least in the forty five states with the sales tax already have a collection and a remittance obligation and already have in place the software that is able to calculate i'm sorry this  and with those five states as is indicated from the briefing it's to scale and it begins at twelve dollars a month for thirty transactions and i think the important thing to look at when it comes to burden is quillan the physical presence doesn't address that issue it doesn't address that issue because the shona national geographic you may have a situation where there's a warehouse there is goods that are warehouse in a particular locality where it will still trigger the sales tax obligation well but if it did i understand you to acknowledge that there would be a constitutional minimum with respect to the burdens in other words that some businesses would not you could other areas you just mentioned i don't know that we've recognised any lower slevin for things like a physical presence right i mean is it one person one building so that would be another special rule in this context wouldn't you know certainly that's one way to look at it yes that when you look at the burdens and you look at really physical presence there are a lot of things that can trigger it it can be a building a warehouse it can be a travelling sales person that comes to visit in south dakota rushmore and there's a sale the other important thing to look at and it comes to burden is the state schemes that are being put in place such as in colorado with the notice in the reporting requirement those are burdens that are of equal  perhaps even greater than a simple collection and remittance of the tax if you have if there are two options let's say option and a is eliminate quel and states can do whatever they want with respect to retroactive liability and with respect to the minimum number of sales that are required in the state in order for the sales to be taxed in order to require them to collect the tax that's option a option b is a congressional scheme that deals with all of these problems if those are the only two options which is preferable option a the reason for option a is this congress has had twenty six years to address this issue and it's not congress but it's quill it's this court's decision that is striking down our state statute generally usually when somebody says something like that that congress has not addressed an issue for twenty five plus years you know it's it gives us reason to pause because congress could have addressed the issue and congress chose not to this is not the kind of issue where you say well probably didn't get on congress radar screen or maybe congress was too busy doing other things this is a very prominent issue which congress has been aware of for a very long time and has chosen not to do something about that and that seems to make the your bar it this is a constitutional interpretation and one way to look at congress is what was just announced by the court today the microsoft decision sometimes the activity of this court will spur congress the same way we treat step shoots i mean i think the examples are legion congress cannot overturn constitutional decisions but in the dormant commerce clause case it's different and of course they can and of course they do so i don't really see a difference there so what's the difference just for i would still say there's a difference because this is a constitutional no no but the word constitutional is not magic the reason that we say we are more willing to overturn a constitutional case is because congress can't act but here they can act and therefore there is no reason for treating it specially what is the response to that i think the reason to treat it special is because we have a situation where congress has had twenty six years we have briefs from three senators and congressman goodlatte that says congress was about to act and indeed what stopped them from acting was our decision to decide this case now what that's their view of it and between whether they know or whether i know i guess they have a better view there are members of congress and they point to many statutes and you are fifty states if you do not have the power to get congress to do something i don't know who would congress doesn't have an incentive in this instance to take action in something that could be perceived as a tax win yet they don't get the opportunity to use the revenue  now it seems that both the states and internet retailers have an incentive to ask for a congressional solution to this problem so the internet research retailers will have to deal with statutes like the colorado reporting statute and with aggressive moves by the states to try to bring taxation within quill in some way and the states obviously have an incentive to choir retail internet retailers to collect the tax so there are incentives on both sides but if well is overruled what incentives did the states have to ask for any kind of congressional legislation well certainly if quill is over ruled the states will have their constitutional responsibilities to follow complete auto and to follow pike i mean what really has happened here is in quill this court set the default it's set the baseline so where a state statute as nondiscriminatory as it may be and is reasonable it may be such a sop the code is it's automatically unconstitutional and struck down and i ask you the question that two or three brief questions you answer them when have wildly different estimates of costs revenues and what states are losing or not how do i find and i'll get another things can you do this on the internet they say there are twelve mistakes even in south dakota all right or not that's question one how do i find out you have a list here of i would say they do of a six or eight really tough practical decisions retroactivity all kinds of things like that how do we deal with that ok i would like to know the answer to that and you've already dealt with one which is well off what is specifically what's the standard what's the standard the government says physical presence any what ok so those were my three questions any time you want to deal with them or if you want to deal with them do so use respondants numbers it's one hundred billion dollars over the next ten years use respondents activity we know they collect in a collection twenty two states they do this in fact dot com now collects in every state so those numbers show that they do this use the g a o to show that of course you can do this companies do this every day system x who was originally a defendant in this case no longer is a defendant because overnight they simply switched over when it comes to retroactivity the states don't want to address this retroactively which is why south dakota illustrated of that has indicated we're prospective only in the briefing thirty eight other states have indicated their laws would prevent retroactivity and are find themselves with physical presence in all fifty states so they're already covered and the workarounds that some of the states have employed are also bringing more in and if it is in fact a problem that is diminishing rather than expanding why doesn't that suggest that there are greater significance to the arguments that we should leave will in place mr chief justice because i think it's because of e commerce e commerce is now nine percent of the market and it's rapidly growing if you look at the numbers it's been challenging for the states to collect on that e commerce the collection rate is as low as former e commerce is expanding and companies like amazon account for a large part of that but they are already collecting in all fifty states and that's the problem it's not that e commerce is expanding it is for from your point of view that i think the problem we have to address is that the coverage in terms of collecting the tax is expanding as well mr chief justice certainly it's expanding but what remains is that one hundred billion dollars loss over the next ten years mr chief justice if i may please reserve the remainder of my time thank you counsel thank you chief justice and me please the court i'd like to start by making to three point about the story decisis and the wisdom of leading this matter to congress that the first point i'd like to make is whatever this court decides whether it over rules bella's tests and quill whether it leaves those in place whether it does something in between congress can act congress can impose whatever solution it believes is appropriate and indeed if states are given greater latitude to experiment in this area to devise different schemes that would balance the interests of out of state retailers against the interests of consumers within the state repression border retailers the state's own interest in acquiring funds if states can experiment congress will have a wider variety of models to and i mean the second thing i would say about quill is that quill has come to be understood to stand for the proposition that an out of state retailer cannot be made to collect state sales tax unless it has employee use or a physical facility within the state that that's the meaning that's been attached to the phrase physical presence requirement that the court used in quill i think in context it's very clear that quill was not issuing any at least an advertisement holding about the role of the internet presence in determining a company's obligation to collect state sales tax the court was dealing with the us has it summarized the bill us house rule as being that if the out of state retailers only contact with the taxing state was delivery of goods and catalogues by mail or common carrier that was insufficient and then the court used the term physical presence requirement we believe as shorthand for that principle but the court was not saying anything one way or the other about the role of a pervasive internet presence in establishing sufficient untax with the state to allow for the collection duty and a rough analogue might be that in the past fifteen years the court this court has sometimes a knowledge that it prior decisions had used the word jurisdictional in a less than precise manner and the court has sometimes said statutes that we previously characterized as jurisdictional are not really that they are something else and to be sure lower courts during the interim were wary of rejecting this court's statement that a particular statute was jurisdictional even if it seemed to be unthinking but the court when it righted itself didn't feel obligated to go through the steps of deciding whether a standard for overruling a prior precedent had been established it simply said we used the wrong shorthand we were not wrong as to the substance and we'll go from there and i think or stuart do you believe that there is a constitutional minimum so that even to come a small business using the internet made have greater burdens then amazon and therefore they have a constitutional claim under your position or under your position can the states impose burdens on any in the micro business i guess is what the term has been used i think our view as to the correct answer the the answer that is most consistent with this court's the body of this court storm prudence is there's no constitutional minimum that if you have an out of state retailer who is deliberately selling a particular physical good within the state shipping the good into the state for delivery to the customer and transfer of title that that is a sufficient basis for subjecting that retailer to the tax collection obligation in the same way that if that single good turned out to be defective the state could be subject to the i'm sorry the retailer could be subject to regulatory burdens imposed by the state conceivably could be hold and go to court to answer for you it isn't that kind of question that congress it would be equipped to deal with certainly the fact that we don't think there's a constitutional minimum doesn't mean it wouldn't be a good idea and it wouldn't hinder congress ability to decide that a moment of them should be essentially a reason why we should leave this to congress in other words from this court's perspective the choice is just binary it's you either have the quill rule or you don't but congress is capable of crafting compromises and trying to figure out how to balance the wide range of interests involved here now the general said congress hasn't done that but again you know congress can decide when it wants to craft a compromise and when it doesn't want to craft a compromise and then congress if it decides it wants to craft a compromise can craft a compromise in ways that we cannot i would certainly agree that congress has a broader range of options available to it than does the court and an ability to devise more nuanced solutions i don't think with respect that accurate to characterize the choice before the court as binary that is although it would not be our preferred constitutional rule it would be open to the court to say physical presence in the form of employee use or physical facilities within the state is not an ironclad requirement and yet not go as far as as we've added the hated namely these are no one within the state is is sufficient and one thing that the court could do is as it often does say we'll look at the statute before us we will decide whether the nexus that south dakota has required in the form of economic contacts within the state as a prerequisite to the tax collection duty that any rate is constitutionally sufficient and the court could leave for another day and for congress the question should a lesser weight be sufficient as well as the part that bring there which i really think we can do after reading these breeds is what they there is saw and puts up a certain specter which i'm sensitive to which is that we have four or maybe five giant potential retailers in the country i mean there could be a very small number selling virtually anything and they sell over the internet and the h etc is small business which finds it easy to enter no you raise with this entry barriers and they say a lot and you say a little and i don't know if it's a little or if it's a lot and if it is a lot there might be ways of putting minimums in that would in fact preserve the possibility of competition and the possibility of new entry stopping the entry barriers from raising too high now that's something the anti trust vision could testify about but they're not going to testify here and so that's the kind of problem that worries me well let me take two or three things about that the first is that the g a o report said  something like eighty or ninety of the hundred biggest in our tape net retailers are paying their state sales taxes so it's it's big companies but it's not just the four or five biggest giants and so the question is kind of how far down the line do you go how small does a company have to be calm in order for that the burden of collecting state sales taxes to to be substantial as as a practical matter and you know our front line answer is the dormant commerce clause doesn't entitle fledgling business to the ability to make a profit if the obligation to collect sales taxes in various states pushes it from making a profit to sustaining a loss that's not a constitutional defect but the other thing we would say is nobody on the other side is really seriously contending that the south dakota law in and of itself places exorbitant burdens and indeed nobody on the other side is even contending that if every state did exactly what south dakota has done that the burdens would be exerted south dakota law is obviously a test case in that it was it was devised to present the most reasonable incarnation of this scheme do you have any doubt that states that are tottering on the edge of insolvency a municipality s which may be in even worse position have a strong incentive to grab everything they possibly can and certainly if the court issued a decision that said physical it adopted our kind of our view of the correct answer that said yourself you make one sale into the state you are obligated to collect the sales tax i have no doubt that if the court issued that ruling many states would adopt regimes that are less hospitable to retailers unless they were stopped from doing that by congress my point though is that there are various contexts in the form of commerce clause particularly in determining whether a state tax is likely to cause duplicative taxation in which the court says what if every state were to do this with the burdens on interstate commerce be exorbitant i have my doubts that that mode of analysis applies here but even if if if it did what the retailers are asking for is something worth much more than that they are asking for the court to say that because if every other state adopted a real seem that was a much more onerous variant of what south position on the question whether retroactive application of this would be constitutional in our view it would be constitutional in part because as i was saying earlier we don't understand will to have issued and ended at burton holding with respect to internet presence the court in our view can simply clarify quill rather than overrule it but even if the court felt that retroactive application of the decision to the collection of back constitutional rules in the following sense that is the court has determined certain correctly i believe that the court's role is to interpret the constitution not to amend it if the court says in june of this year that the dormant co clause means x it can't say that up until now the dormant commerce clause meant something else and in that sense prospective decision making is inconsistent with the judicial role however there are circumstances and qualified immunity is one of them where even though the newly announced constitutional rule as a rule applies retroactively the ability of the veil ability of particular types of relief may depend on whether people were justifiably uncertain at the time thank you mr chief justice and of please the court i'd like to direct my initial responses to some of the questions that justice prior was asking counsel he pointed out the fact that there were conflicting numbers before the court regarding what is the amount of lost revenue that the states are experiencing and he said what should we rely upon the most authoritative independent and extensive study was the one that was done by the general accountability office and the general accountability office determined that the private study that was done by two professors at the university of tennessee which was issued in two thousand  nine based on two thousand and six figures and then updated in two thousand and twelve based upon two thousand and nine figures the g a o indicated that the figures were only one quarter to one third of the amount of last read that wasn't the problem really the problem really is your brief is filled with stop i mean for example go to the website which i went to that they recommend and it seems easy to determine what the sales tax was and you say but my god even twelve mistakes in south dakota and moreover there are ten thousand different ones and you try to do that you get it wrong and either the state it's us is five hundred dollars penalty for every mistake which is billions or you know a lot and or the class action lawyers sue you for having paid too much all right yours is filled with that kind of thing their brief says you know even if we don't have perfect software we can develop it it's not so hard and when there's a demand for it we'll do it and it'll be easy and you say it's going to cost thousands and thousands of dollars for a small business maybe all their profits eaten up in hiring accountants they say that won't be necessary we'll do it on software and hey they're not going to and do it but overall prospectively ok both are logical how do i decide who's right but part of the problem just as proud as the fact that there's no record in this case and so in trying to determine even as a matter of stari decisis whether there is a special justification for overruling quill i think the problem that you've identified is that no record has been presented to the court that would support that substantial stage everybody is treated to the same tax collection abrogation or who exploded in state market are subject to the in state tax why isn't that equalizing well the dormant commerce clause takes as its principal objective the maintenance of a single national marketplace that is free and accessible to all participants and the court found back in the sixty seven that the existence of twenty three hundred different sales and used tax jurisdictions with varying rates varying exemptions varying taxability items varying filing requirements and audit  obligations was a burden and state commerce in one thousand nine hundred to one quill was decided that figure went from twenty three hundred to six thousand that figure today is over twelve thousand different jurisdictions so the concern that the bell assessed and quill courts had was the notion that day three and open market would be encumbered by that degree of complexity and that complexity is only worsened i don't think you've quite address ginsburg's question which is brick and mortar retailers if they choose to operate in any given jurisdiction have to comply with that jurisdiction there are lot of retailers that have to comply with lots of different jurisdictions rules why should we favor this court favor in particular business model that relies not on brick and mortar but on mail order i understand bill us has the court was concerned about a nascent small mail order industry those concerns seem a little antiquated today so it maybe even could address justice ginsburg's questions the same one i have so anything you might say on that would be helpful they just cos its borders count the states exercise their sovereignty based upon borders territorial limits it's a key part of horizontal federalism in this country so if there's going to be some standard that determines when it's a company subject to the tax jurisdiction of the state using the the territorial limits of that state makes sense what i think is most significant in looking at this this issue is that most of the large retailers nineteen of the twenty largest internet retailers already do collect tax because the nature of the market has required them to establish a local presence among the one hundred top internet retailers the collection rate is between eighty six and ninety seven percent but it's still not responsive council you're just merely pointing out that more an internet retailers are moving toward brick and mortar fine but again why should this court favor those who don't over those who do that's the question so the united states is suggested that even one sale into the state would require collection no point of sale retail only has to comply with one jurisdiction cost for a mandolin seller who sells mandolins on the internet to sell them in fifty states how much does it cost him to enter that market how much did it cost with sears roebuck you know that's an ancient name but they did or and by the way how much does it cost amazon voluntarily to comply and i mean you see there in pyrrhic all questions that i think are would help me reach an answer and if you know them tell me no one asked amazon what does it cost amazon what does it cost the mandolin sale or sell or what are these are there different the cost of just implementation and integration of a software system before you dealing with in any of the other issues costs up to two hundred fifty thousand dollars that the maintenance of a system will get its arts at twelve dollars we know that too right so that figure seems a little misleading i guess the real question i think justice breyer's maybe getting at in i love your help on this too is the comparative difference right after quill  now states may force internet providers to provide information like colorado does that enable them to collect tax from the tax payer so the real delta here isn't no duty at all on the internet supplier versus collecting sales taxes it's something like colorado's regime versus collecting sales tax do you have any information at all as to which is the lesser burden i wondered whether the car regime might be more burdensome to clients like yours who do sales over the internet than just simply collecting the sales tax itself the colorado regime is much less there than some that have any data on god but the reporting requirement for the colorado law simply requires a single annual spreadsheet reporting of all the purchases that one day by colorado residents and then the state has to bring in and going after processing of payments it can require standard uniform definitions of products so that food and sportswear and clothing doesn't mean one thing in one jurisdiction and another elsewhere i think an important part of the history of this issue and correcting what i think is the misimpression that's been presented by the united states and the state of south dakota is that congress has been active on this issue going back to shortly after the quill decision congress passed the internet tax freedom act in one nine hundred ninety eight which established an advisory commission on electronic commerce which issued a comprehensive report in two thousand detailing the items that the states should address to simplify the tax systems in order to warrant federal legislation and it called upon the states to develop that system within five years the minority report called upon the states to issue to develop that system within two years the states did not develop that that system a number of states initiated a project called the streamlined sales tax project to come up with such a uniform system of taxation and over two thirds of the states with population having overt states with population within two thirds of the national population refused to join and that included all the largest states like new york pennsylvania illinois texas florida california so that congress has given clear direction to the states the kind of steps that should be taken if they were going to be obtaining from congress broader tax jurisdiction the can you imagine saying anything something we were and it's hypothetical to accept your position is there anything we can do to give congress a signal that it should act more firm if we in this here would welcome a decision from this court that would indicate that congress should move forward with consideration and action upon legislation  but i think though maybe they already maybe they already have and they've made a decision or at least more juries have made a decision that this is something they're going to leave the way it has been for whatever is twenty five years  chief justice that all of the players that are involved in this issue are in favor of that a federal legislation for the direct marketing industry as i pointed out to you  largest players are collecting tax they would welcome simply you say that the congressional action should be taken against a background in which this court has made a statement of constitutional law that is as now especially in light of the cyber a proven incorrect so you want the congress to act against the background in which this court has made an incorrect resolution assumption of many of these questions is that quote is incorrect but that that doesn't make any difference and i'm suggesting that it does make a difference one constant when congress acts for it to determine what the constitutional rule is  correctly stated by this court now i understand you think was correct but most of these questions of just assume that cool is incorrect but what difference does it make i think that then introduces the issue of starry decisis because the standard of star decisis is that even with a court has ruled incorrectly there's a value in settled expectations and standing by the decision previously and that is most powerful when congress has the ability to beginning strong dissenting opinions and there was a suggestion that they be a test a test case why shouldn't the court take responsibility to keep cases in tune with well first a quick the cool court did not invite just case litigation on the issue justice kennedy raised that issue in his concurring opinion in in the brawl decision but i think the main reason justice ginsburg is because of the immediate overturning of quill or or turning to a congressional solution the result would be chaotic it's interesting if you take the statement of colorado's only member of the house of representatives katie no one said quote if the supreme court rules himself to code his favor it could become a marketplace free for all a south dakota small business for instance could be forced to comply with one thousand different tax structures nationwide without the tools necessary to do so that's from a high official representing on these days that don't you think there's enough and think of in the system that if  the actual looking up of the rate for the twelve thousand different textures dictions hardly scratches the surface retailers need to map their products against that software which is right with their is because common products are defined differently in different states and it's not merely the forty five states plus the district of columbia that have sales tax but there are over five hundred home rule jurisdictions that have their own tax bases and definitions the record retention that's necessary for exempt buyers exempt transactions exempt uses is a physical process that needs to be done by the by the retailer the filing of the of the reports are different for the various states like justice ginsburg was perhaps suggesting was that all these functions would be to essentially taken over by companies like amazon and and at sea they would do it for all of the retailers on their system now there's something a little bit ironic in saying the problem with quill is that it benefited all these companies so now we're going to overturn quilts so that we can benefit the exact same companies but but i think that that's the idea that in fact this would not formal on individual entrepreneurs that it in instead they would pay fees to companies like amazon the problem justice kagan is that a number of the functions that i described simply cannot be performed by software so for example if you need to collect resale and other forms of exemption certificates states require that those be physical papers that that you collect there's no software solution that if a state is coming into audit you software doesn't solve that for you in in any real respect so software can do certain functions and those functions might be improved by entrepreneurial  initiatives but they're not going to solve these other issues and what will happen because of the substantial expense that's associated with this is that small and midsize companies will be deterred from entering that market they have a choice they can either invest in have a website and by the end of two thousand and eighteen it's estimated that ninety one percent of small businesses will have a website so the issue here is not between small in state retailers and out of state direct marketers the real competition is between the large companies who are these merchants who are multi channel merchants who are increasingly dominating the internet and one of the effects if you increase the cost of admission if you have  barriers to entry one of the inevitable effects is going to be that those small and medium sized companies are going to be deterred and there will be even greater concentration by the largest retailers again i think that is antithetical to what the objectives of the commerce clause work the arguments that the united states made i think race on some very disturbing notions of what the future would would look like the notion mr stewart presented that there was no constitutional minimum if the court overturns quil that any single sale would obligate a company really really something that really appealed to congress to fake because the whole picture congress doesn't want to look like it's increasing taxes but fixing something like that would not encountered this same he the absence of any incentive of the states to seek a congressional resolution in the event that quote was overruled i think is a major impediment to the notion that congress who come in and fix the problem and is just a sort of my all pointed out what happens in the interethnic what happens in the one or two or three year period before congress acts and companies are confronted with this dilemma of collection the notion of a chaotic period preceding congress coming in to address the issue is as daunting as any in terms of what the consequence of d in this instance leading state leaders for example the director of tax policy for the conference of state legislatures has publicly stated that if this quote were to overturn quil there's no reason that the states would favor federal legislation so that dynamic is one which i think would likely stalemate congress rather than encourage congress to act i do want to make special emphasis on the issue of starry decisis because since quill has been in place and there's been a clear explanation of what the standard is for tax jurisdiction literally thousands of companies have conform their conduct to the standard that was was established justice scalia's concurrence in the quill case said that with that kind of reliance it is present and companies have ordered their economic affairs in that reliance that the doctrine of sorry decisis is at its acme and he also pointed out that that is especially so we have a congress can address the issue if congress were to address the issue i think there'd be no doubt that it would be purely prospective in fact i think that's the only thing congress could probably do is have a prospective law but this court has indicated that question companies have made their investment decisions based upon a business model understanding what the quill standard requires so well you know it's the assumption when you're talking about starry decisis is that the decision was wrong so you're saying they've made business decisions on the basis of the iranians decision when the decision is based on the fact that well you should taxpayers are not being paid i think a word benefit comes from them not just from the fact that they don't have to collect but from the fact that most people aren't paying use taxes i think justice kagan's to citizens in de mille's at a kimball make clear that the application of starry decisis is not dependent upon the correctness of the decision which is being followed in fact if a decision is correct starry decisis is unnecessary the decision would be standing on its on its own legs  so here you have a situation quite different than other cases where the court has been able to declare that there was no reliance or no rightful reliance here you have a situation where you have a whole industry that has understood what the rules are i think justice scalia's term in his concurrence in the quo case was that these companies had the right to take us at our word that that was the standard that was that was is there any prefer i can agree or any source to determine what constitutes a small business in america i don't even have the answer to that ok the figures we were given was based on a small business but is two hundred sales a year the minimum or is it something higher that's the south dakota has a minimum amount of sales i don't know i don't know enough about the internet to enter make a judgment as suggested by the solicitor general to make a judgment that these are actually the right numbers there's something i can look at a few small business administration defines small business in various categories of business activity so that's certainly a source that you could look at the figure of two hundred transactions i think needs to be put into it to clear perspective the average internet transaction is eighty four dollars so two hundred transactions times eighty four dollars is less than seventeen thousand dollars so it's not the one hundred thousand dollars a year figure and there are many internet sellers for example that c has one point nine billion participants on etsy and many of them are selling products that have only a ten dollar sales value so ten times two hundred is two thousand dollars the compliance cost of of complying with the south dakota sales and used tax law and two thousand dollars worth of sales would far exceed whatever the profit margin is and it becomes a good example of colorado's morning requirements but i mean if we're going to compare barriers to entry we have to  compare apples to apples and so we wouldn't compare it necessarily against a baseline of nothing we'd have to compare it is against the reporting requirements of a state like colorado so do you know what the difference the delta there is i don't i don't you i don't have  are no further questions thank the court thank you counsel general jacqui five minutes remaining thank you mr chief justice justice pryor i owe you an answer to your third question and that is what rule would apply and i would tell you the sky isn't falling jurisprudence already in place with respect to a tax assessment is complete ato with respect to the collection side and concerns with burden the balancing that pike has and place provides its constitutional protections when it comes to i think it gives you the nexus i think there could be a set of circumstances and that's precisely what pike is for to address that in the balancing but generally speaking if there's a sale there's an activity in the stairwell at the complete auto is it's it's a nex us such that the benefits of state revenue do not outweigh the compliance costs associated with the tax collection obligations that the state has imposed you know that seems like a sensible test until i suddenly think of ten thousand cases being brought by twenty thousand lawyers on one side and another twenty thousand on the other to decide jurisdiction by jurisdiction case by case about whether that case is met now that that's that that was my problem with complete auto and complete auto addresses every other tax issue a sion other in sales an actor that's a very good point and pike addresses every other state regulatory system under the commerce clause and i think it's based upon that the sky isn't falling the question came up about what signal needs to go to congress and i would submit i don't believe this court has to but if if they're looking for a signal that signal is to overrule quill i mean to reset the default so that the default like here isn't doing all the work it's a situation where it's this court's decision in quill that's basically striking down every state statute including mine no matter how nondiscriminatory no matter how low the burdens are i live in a state that is a streamlined tax state which means we pay all those collection or mitten costs in fact we actually pay the businesses up to seventy dollars a month to be a part of that so there is no burden certainly less of a burden than what is happening in colorado with a notice and a reporting requirement the question came up about no record and the reason there is no record in any of these cases it is because quil makes every fact beyond physical presence irrelevant that's why quil was summary judgment dma was summary judgment this case a summary judgment and i think if you truly want to protect the small sellers quil doesn't do that because you have a national geographic situation where a a business is placed something in a warehouse or a sales representative goes into a state and it doesn't just trigger the state's taxing it triggers every local jurisdiction also puts california trigger several hundred different taxing consequences so cool doesn't protect against that a statute such as sop the code is does it sets a reasonable limit of one hundred thousand dollars and two hundred specific transactions i know there's been a lot of conversation about retroactivity and i would again go back to the states are not looking to apply this retroactively thirty eight states laws a set forth in part b of our appendix can't forty five state attorney generals the chief litigants that will be addressing this issue are telling you there are significant constitutional consumer why is it that states are doing it the other side pointed us to a number of states that are already making it richer i believe i mean justice sotomayor i believe that the other side pointed to one state connecticut whose low level representative sent a letter asking it to apply prospectively from here forward and i would point out that attorney general jepsen who signed the forty five state briefs will actually be making that decision and the true problem with retroactivity is is what's at issue what's at issue is not an assessment it's a collection so what should be doing is telling the remote seller you don't have to collect and remit this and then three years later you would say oh by the way you do and we've now changed that collection responsibility to a penalty and interest and that has significant constitutional concerns which is why the states aren't doing it and aren't likely going to do it i truly believe that if you go to look at what is issue here it goes back to what i originally said small businesses are not being treated fairly we're not asking remote sellers to do anything that we're not already asking our small businesses to do in our state and that is simply to collect and remit a tax i have no further information your honor thank you general the case is submitted