February 2, 2024

Challenge to Illinois "Level the Playing Field" Law for Online Retailers

The Illinois “Level the Playing Field” law that went into effect January, 2021 is believed by many online retailers, and those in the sales tax industry, to violate the US Constitution’s Commerce Clause and place an unfair burden on out-of-state retailers.

It comes as no surprise that a petition has been filed by an out-of-state online retailer (PetMeds) with the Illinois Independent Tax Tribunal to challenge an audit assessment that was based on the Level the Playing Field law.


The PetMeds challenge is based on two points:

1) that the Illinois requirements discriminate against interstate commerce and

2) the different treatment between remote sellers and in-state sellers selling from remote locations. What seems truly interesting is the argument that PetMeds mentions which is the differential treatment between remote sellers and in-state sellers selling from a remote location. In-state sellers selling from out-of-state locations only charge state level use tax at the rate of 6.25%,while similarly situated remote sellers are obligated to charge both state and local sales taxes.

This clearly is a violation of multiple sales tax standards and creates a discriminatory tax. The outcome of this petition may have far-reaching implications, not just in Illinois, but in other states who may be considering similar laws.


Stay in touch with us as we follow this case and be sure to listen to our podcast, Taxing Poetic here, where we have covered this topic and others.

If you have questions or need a responsive, experienced sales and use tax team to help you stay in compliance, call or email anyone on the Synexus team. Reach out to our team here.

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