In today’s fast-paced world, recent political and legal accomplishments are often quickly forgotten as we move on to the new challenges of the day, but I’d be remiss if we didn’t pause for a brief moment and look back to June 21. On that day, as was widely reported in the trade and consumer press, independent booksellers nationwide won a landmark legal and business victory. In a five to four vote, the U.S. Supreme Court reversed long-standing precedent and ruled that all retailers — both bricks-and-mortar and online — must collect sales tax for online orders.
ABA has been engaged in the sales tax fairness fight for more than 20 years, working closely with independent booksellers nationwide and other key allies. Way back in the early 1990s, I — together with Bill Petrocelli of Book Passage in Corte Madera, California — represented ABA at a press conference in what was then the space for A Clean Well-Lighted Place for Books at Opera Plaza in San Francisco, where, with other organizations, booksellers took an early leadership stand for e-fairness. And the fight began.
As you may recall, those were challenging days for indie bookselling. Amazon.com was a very new company with very large ambitions, and, importantly, a clear plan for leveraging a gaping legal loophole into a significant competitive advantage. That loophole has now been closed.
As Justice Anthony Kennedy noted in last month’s majority decision, the earlier legal precedent set by the 1992 Quill v. North Dakota decision “puts both local businesses and many interstate businesses with physical presence at a competitive disadvantage relative to” Amazon and other online retailers. ABA had long maintained that was clearly the case, and now any legal ambiguity has once and for all been removed.
Because Main Street bookstores were Amazon’s first targets, booksellers all across the country were leaders in the fight for e-fairness on the city, state, and national level. For two decades we have been both focused on the goal of leveling the playing field and firm in our conviction that — despite how long it might take — this fight would be won.
From the start, together with the regional trade associations and other retail allies, ABA has worked long and hard to provide the facts, resources, and staffing necessary to assist stores in effectively reaching out to elected officials and making the case that it is not the role of government to be picking and choosing winners in a competitive retail landscape. Faced for many years with what was effectively political gridlock on this issue at the national level, our coalition also worked on the state level, winning a series of significant victories that, collectively, helped reach a political and economic tipping point.
This letter can in no way do justice to all the hard work on the part of so many for so long. This victory is the result of an untold number of letters written to elected representatives, hundreds of visits with public officials and their staff, hours and hours spent testifying before state legislative committees, and scores of op-ed pieces published in local and national publications. All these efforts combined to change the public conversation about this issue, and to pass groundbreaking legislation. Indie booksellers were at the center of this fight and once again demonstrated the enormous influence and clout we hold.
In hindsight, it’s clear that the legislative victory in New York State — achieved, in part, due to the efforts of the New Atlantic Independent Booksellers Association and our colleagues at the Retail Council of New York State — was a turning point in the fight. In 2008, New York became the first state to mandate that Amazon collect state sales tax. Amazon challenged the law to the state’s highest appeals court and lost. When the U.S. Supreme Court refused to hear the case, Amazon was forced to fundamentally rethink its obstinate policy of sales tax avoidance. Following New York, many states passed laws to ensure sales tax fairness, and in every region the winning strategy for indie booksellers and our allies was the same — persistence, perseverance, effective coalitions, and a clear focus on the final goal. Nationwide, the coalition grew, as booksellers, regional trade associations, allied bricks-and-mortar retailers, elected officials, and others successfully fought for e-fairness.
Last April, a milestone was reached. Amazon was finally collecting and remitting sales tax in all 45 states that collect sales tax. But as ABA argued in an amicus brief submitted last November in support of the U.S. Supreme Court case, “given the realities of retailing in the 21st century, if Quill is not overturned, it is inevitable that some future retailer will use this 1992 decision to gain a significant and unfair advantage over their bricks-and-mortar competitors.” Indie booksellers’ ongoing advocacy on the state and national levels created the conditions within which the Supreme Court ruling has brought the law of the land into the 21st century. With the court’s decision, one of Amazon’s most inequitable competitive advantages — for both itself and online merchants using its marketplace platform — is gone.
It’s already clear just how significant our sales tax victories over the past years have been. One of the key factors in the resurgence of independent bookselling is that the playing field has been leveled. We saw signs of this in New York State following the 2008 e-fairness victory, and, as additional states took steps to enact sales tax fairness, more and more independent bookstores were operating in a commercial environment that rewarded innovation, execution, and strong local ties.
ABA understands that this Supreme Court decision is not a retail panacea. But it’s important to acknowledge — and to celebrate — this outstanding collective triumph for indie bookstores, Main Street businesses, and local communities. I want to extend our sincere thanks and congratulations to our many allies at the regional bookseller associations, our fellow indie trade associations at the Advocates for Independent Business, Stacy Mitchell and her colleagues at the Institute for Local Self-Reliance, the Retail Industry Leaders Association, the National Retail Federation, and to the literally hundreds of individual booksellers who made this possible. And, of course, to ABA’s own Dan Cullen and David Grogan, whose dogged persistence in waging this fight was indispensable.
There will be no shortage of challenges to come, but, for today, all congratulations on a job well done!
Oren J. Teicher
CEO, American Booksellers Association