South Dakota to begin collecting online sales taxes

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PIERRE, S.D. (AP) - Online shoppers in South Dakota: it's time to start coughing up sales tax.

The state on Thursday will start requiring many out-of-state online retailers to collect South Dakota sales taxes under legislation approved earlier this year. It came after a U.S. Supreme Court ruling in South Dakota's favor opened the door for consumers to see sales tax on more online purchases from out-of-state companies.

Some retailers had been voluntarily remitting the taxes. South Dakota's obligation applies to outside sellers who do more than $100,000 of business in South Dakota or more than 200 transactions annually with residents.

The state announced Wednesday a settlement with three companies it sued in the case that brought the issue to the high court. Online retailers Wayfair, Overstock and Newegg will start collecting Jan. 1.

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