The Untaxables Sarah Harney | July 2002 In May, the announcement by Sears that it plans to buy Lands' End set the retail industry abuzz. Since then, analysts have been speculating about how the department store chain will merge its old-line business with a mail-order and online company, and what that combination portends for the future of retailing. Whatever it might mean to the business sector, the Sears-Lands' End deal suggests something entirely different to the 45 states and 7,500 localities that levy sales taxes: the possibility of splitting a pot of $90 million a year--and, potentially, hundreds of millions more. The $90 million represents roughly the amount of annual sales-tax revenue that Wisconsin-based Lands' End currently does not collect on its $1.6 billion in sales of fleecy sweaters, weekend luggage and the like. That's because in 1992, the U.S. Supreme Court ruled that states cannot compel a company to collect taxes for them if that company has no physical presence in a state. Lands' End has no physical presence-- no nexus--in 46 states.