# Wayfair: “Still Ignoring Sales Nexus” Or “Evolution of”

By Business Services · Published 2023-11-06 · Updated 2026-03-12 · Professional AV on MarketScale
Canonical: https://www.marketscale.com/industries/pro-av/wayfair-still-ignoring-sales-nexus

> E-commerce leaders face critical compliance shifts as economic presence redefines sales tax obligations across states

## Key points

- E-commerce leaders face critical compliance shifts as economic presence redefines sales tax obligations across states

In this [*Weaver Beyond the Numbers*](https://weaver.com/podcast) episode, [Steven Scarborough](https://weaver.com/about/people/steven-scarborough), [Mayur Naik](https://weaver.com/about/people/mayur-naik), and **Brandon Hayes** review the implications of the **Wayfair vs. South Dakota** case. As e-commerce continues to dominate the market, understanding the nuances of sales tax and economic presence becomes crucial for businesses.

**Key Points:** 

- The **Wayfair vs. South Dakota** case determined that companies can have an economic presence, not just a physical one, obligating them to collect sales tax
- Companies must be aware of varying state thresholds and definitions of nexus, impacting both sales and filing obligations
- Businesses can address potential noncompliance through voluntary disclosure agreements with states, often settling penalties and interest

Block Field

The **Wayfair vs. South Dakota** case marked a significant shift in the perception of businesses regarding their economic presence in a state. No longer is it just about physical presence; the Supreme Court's ruling emphasized the importance of economic activity. This change has broad implications, especially for businesses operating online. With e-commerce on the rise, understanding these nuances is essential for compliance and avoiding pitfalls.

> You can now also have an economic presence in our state.

As **Naik** explains, "In 2018, the company **Wayfair** brought a case against the state of **South Dakota**… It’s no longer mandatory that you only have a physical presence of store location or people. You can now also have an economic presence in our state." **Hayes** elaborated on the challenges, stating, "I think where a lot of companies end up getting caught up is that the ones that are educated on the decision believe that economic nexus has replaced physical nexus, and it's just not true."

> I think where a lot of companies end up getting caught up is that the ones that are educated on the decision believe that economic nexus has replaced physical nexus, and it's just not true.

Subscribe and listen to future episodes of *Weaver: Beyond the Numbers* on [Apple Podcasts](https://itunes.apple.com/us/podcast/weaver-beyond-the-numbers/id1454557574?mt=2) or [Spotify](https://open.spotify.com/show/62oGgoc3SkSK8nNGM7Vq4A).

Tags: E-commerce, Economic Presence, Sales Nexus, South Dakota, Tax compliance, Wayfair, Weaver Podcast

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