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In an important victory for online retailers, in April of this year a federal circuit court judge struck down Illinois' recently enacted “Main Street Fairness Act,” 35 Ill. Comp. Stat. 105/2 (2011), as violating the Commerce Clause of the U.S. Constitution. See, Performance Marketing Association Inc. v. Hamer, No. 2011 CH 26333 (Ill. Cir. Ct., April 25, 2012). The Illinois Act was enacted in 2011 in an effort by Illinois legislators to force online retailers with no physical presence in the state to collect sales taxes directly for online purchases made by Illinois residents by focusing on advertising affiliate relationships within Illinois. As an update to our article in the June 2011 issue of Internet Law & Strategy, this article highlights important case developments and new legal trends that have emerged with respect to the collection of state sales taxes by online retailers. See, Marcelo Halpern et. al., “Taxing Online Sales: States and Online Merchants Battle over Affiliate Nexus as Illinois Joins the Fray,” Internet Law & Strategy, Vol. 9, No. 6 (June 2011), http://bit.ly/K3rjQo. The article also provides a general overview of online sales taxes and the constitutionality of click-through affiliate relationships.
Illinois Update: PMA v. Hamer
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