Economic nexus represents a shift in how states determine a business's obligation to collect and remit sales tax. Traditionally, sales tax nexus was based on a physical presence in a state, such as a storefront or warehouse. However, with the rise of online commerce, the Supreme Court's Wayfair decision allowed states to adopt economic nexus standards. This means that businesses can be required to collect sales tax in states where they exceed certain sales thresholds, even if they have no physical presence there.