A number of Federal issues have taken the spotlight in recent weeks. The U.S. Supreme Court has been very busy with three recent rulings that will have impact back here in Illinois.
First, there were no decisions on reversing any lower court rulings on the issue of partisan gerrymandering. The opinion leaves in place the current legislative lines, as the ruling came on procedural grounds. The court found the plaintiffs lacked legal standing and unanimously sent the case back to federal district court. Now, a huge question with massive political overtones remains: Can a redistricting plan be so partisan that it violates the Constitution?
Second, The U.S. Supreme Court ruled that states can impose their sales taxes on some online purchases. Illinois already collects sales taxes on many internet purchases and Illinois residents are already obligated to pay a Use Tax on out-of-state purchases.This decision will allow states the ability to enforce Use Tax laws that are already in existence. The state sales tax can be applied to out of state vendors who sell more than $100,000 a year on the internet or make more than 200 transactions in a year. The collections will start Oct. 1.
In a 5-4 decision, the Supreme Court basically overturned a previous ruling that states can only impose a sales tax on internet sales when a company has a physical presence in the state, meaning a structure. In its decision, the court said that previous ruling was flawed and that it put brick-and-mortar stores at a competitive disadvantage. It also acknowledged that internet shopping has changed dramatically since the previous ruling.
Please make sure to check with your accountant to see if / how your business may be affected.
Third, The U.S. Supreme Court ruled that nonunion members can’t be forced to pay a “fair-share” union fee. In a 5-4 ruling, the court struck down an Illinois law, similar to laws in 22 other states, that allowed agencies to collect fees from nonunion members for collective bargaining. The court ruled that the law violates the First Amendment because it compels the employee to support a union message they may oppose.
“Neither an agency fee nor any other payment to the union may be deducted from the nonmember’s wages, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay,” Justice Samuel Alito wrote.
Additionally, the White House imposed new import tariffs of 25% on steel and 10% on aluminum from most countries. Temporary reprieves for Canada, Mexico and the EU expired on June 1, effectively doubling the volume of imports subjected to tariffs. In addition, an import tariff of 25% was placed on auto parts. This industry is 10 times larger than the aluminum and steel industry when in comes to imports.
The State of Illinois is the 5th largest exporter in the U.S. and the largest exporting state in the entire Midwest. Illinois exports diverse products in many industries – Illinois’ agriculture industry being a single largest contributor of exports. Whether our members are in industrial manufacturing, transportation, agriculture, or any type of business, decisions involving trade and investment leave an immense economic impact and must be monitored closely.