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George Isaacson (left), lead counsel for the defendants in the South Dakota vs. Wayfair case, outside the Supreme Court. Photo: Alex Wong/Getty Images.

Supreme Court justices seem split on whether to allow state governments to collect sales tax from online retailers, a move that would drastically change long-standing interstate e-commerce rules.

Why it matters: It's one more example of the Supreme Court grappling with the collision of existing legal precedent and the realities of the tech-driven economy.

Driving the news: In the case before the high court Tuesday, South Dakota sought to overturn established rules that only allow states to require retailers to collect sales taxes if they have a physical presence there. Online retailers Wayfair and Overstock say changing the rules would force online retailers to deal with a confusing patchwork of state tax laws.

Most large online retailers already pay sales tax, but many of the smaller vendors using their platforms often don't. Small- and medium-sized online retailers may struggle with the logistics of collecting and remitting sales tax in the 45 states that have one.

A state-by-state sales tax system could force small sellers to rely on large online retail platforms like Amazon, Etsy and eBay who have the infrastructure to deal with the complexity, said Steve DelBianco, President and CEO of NetChoice, an e-commerce trade association.

  • Those online marketplaces may also feel the biggest effect: The Government Accountability Office estimates that between $3.9 billion and $6.2 billion in taxes could have been collected on goods sold by smaller vendors in 2017, the WSJ pointed out.

In Congress: Online retailers say it's up to Congress to address the issue — even though Congress has failed to act. Rep. Bob Goodlatte has pushed legislation to streamline online sales tax, but those negotiations stalled.

What's next: A decision is expected by the end of June.

Go deeper: USA Today has a good overview of Tuesday's arguments.

Go deeper

Salesforce rolls the dice on Slack

Illustration: Sarah Grillo/Axios

Salesforce's likely acquisition of workplace messaging service Slack — not yet a done deal but widely anticipated to be announced Tuesday afternoon — represents a big gamble for everyone involved.

For Slack, challenged by competition from Microsoft, the bet is that a deeper-pocketed owner like Salesforce, with wide experience selling into large companies, will help the bottom line.

FBI stats show border cities are among the safest

Data: FBI, Kansas Bureau of Investigation; Note: This table includes the eight largest communities on the U.S.-Mexico border and eight other U.S. cities similar in population size and demographics; Chart: Naema Ahmed/Axios

U.S. communities along the Mexico border are among the safest in America, with some border cities holding crime rates well below the national average, FBI statistics show.

Why it matters: The latest crime data collected by the FBI from 2019 contradicts the narrative by President Trump and others that the U.S.-Mexico border is a "lawless" region suffering from violence and mayhem.

Miriam Kramer, author of Space
2 hours ago - Science

The rise of military space powers

Illustration: Aïda Amer/Axios

Nations around the world are shoring up their defensive and offensive capabilities in space — for today's wars and tomorrow's.

Why it matters: Using space as a warfighting domain opens up new avenues for technologically advanced nations to dominate their enemies. But it can also make those countries more vulnerable to attack in novel ways.

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