Colorado Internet tax case could change online shopping

DENVER, C.O. (AP) - Buying things online could get pricier after the U.S. Supreme Court rejected a case that could ultimately lead to states collecting billions of dollars in sales taxes lost to increasingly popular Internet retailers.

The court would not hear a challenge to a Colorado law requiring online sellers such as Amazon.com to notify customers and the state how much they owe in taxes. State officials have estimated that Colorado alone has been missing out on as much as $172.7 million a year. South Dakota had been missing out on roughly $35 million a year according to Gov. Dennis Daugaard.

At least three other states: Louisiana, Oklahoma and Vermont have passed similar laws.

Though the court didn't endorse Colorado's law and could even weigh in against it if given a different case, other states are likely to see Monday's move as a green light to step up collection efforts. That comes despite a 1992 Supreme Court decision saying retailers must have a physical presence in a state before officials can make them collect sales tax.

Online shoppers always have owed state sales taxes on their purchases, but the rule has been widely ignored. States have spent years examining ways to capture those lost tax dollars, but their options are limited when the retailers are not based in the state.