WORLD Law Direct Forums  





Go Back   WORLD Law Direct Forums > Forum Information > Law News
REGISTER FAQ SEARCH Today's Posts Mark Forums Read
Personal Lawyer Legal Forms Calendar

Law News Breaking law news and events.

Any updates on this issue?... Amazon Sues Over State Law on Collection of Sales Tax

Consult Your Own Personal Lawyer Now!
Reply
AddThis Feed Button
 
Thread Tools Search this Thread Rate Thread Display Modes
Old Nov 4th, 2008, 12:18 PM     #1
Unregistered
 
Unregistered's Avatar
 
Posts: n/a

Default Any updates on this issue?... Amazon Sues Over State Law on Collection of Sales Tax

By SAUL HANSELL
Published: May 2, 2008

Amazon.com has filed a lawsuit challenging New York State’s new law forcing online retailers to collect sales tax on shipments to state residents.

On Friday, Amazon filed a complaint in State Supreme Court in Manhattan objecting to the law, which was approved as part of the $122 billion state budget that Gov. David A. Paterson signed last week. The law is expected to raise about $50 million.

The issue is not whether people should pay tax when they buy goods from out-of-state sellers like Amazon. For decades, the state has required them to pay sales or use tax.

The question is whether the vendors must collect that tax on behalf of the state. Generally, only those companies that have a physical presence — like an office or store — in the state where the purchase is made are required to collect the tax.

The new law is based on a novel definition of what constitutes a presence in the state: It includes any Web site based in the state that earns a referral fee for sending customers to an online retailer. Amazon has hundreds of thousands of affiliates — from big publishers to tiny blogs — that feature links to its products. The state law says that thousands of those have given an address in New York State, although the addresses have not been verified.

The law says that if even one of those affiliates is in New York State, Amazon must collect sales tax on everything sold in the state, even if it is not sold through the affiliate. This is an extension of an existing rule that companies employing independent agents or representatives to solicit business must collect taxes for the state.

Amazon’s suit challenges the constitutionality of this interpretation and seeks a declaratory judgment that it is invalid.

The company’s complaint argues that the statute is “overly broad and vague.” It is impossible, Amazon wrote, for it to determine which of its affiliates are actually in New York State.

Amazon says that its affiliates are not agents, but simply sites on which it places advertising. The commissions it pays the sites are simply one method of paying for those ads, it argues.

And it further claims that the new rules violate the equal-protection clause of the Constitution because they specifically took aim at Amazon. “It was carefully crafted to increase state tax revenues by forcing Amazon to collect sales and use taxes,” the complaint says, noting that “state officials have described the statute as the ‘Amazon Tax.’ ”

Tom Bergin, a spokesman for the New York State Department of Taxation, said that the department would not comment on the suit until it filed a formal reply with the court. The state’s defense will be coordinated by the attorney general’s office.

http://www.nytimes.com/2008/05/02/ny...partner=rssnyt
  Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes Rate This Thread
Rate This Thread:

Add Forum to Google Toolbar | Format Your Messages

Posting Rules

Similar Threads
Thread Thread Starter Forum Replies Last Post
International Tax-Shelter Plot Thickens; Mogul Sues UBS WSJ_law_blog Law News 0 Sep 17th, 2008 09:20 AM
State Sales Tax Holidays USA.gov USA.gov Updates 1 Jul 31st, 2008 08:56 AM
MANOJ SERVICE TAX ISSUE manoj kr jain Tax Issues 3 May 29th, 2008 08:01 AM
NY state debt collection / divorce. Need immediate help please. Unregistered Consumer Bankruptcy 1 Mar 21st, 2008 08:00 AM
internet sales tax Unregistered Starting a Business 1 Dec 21st, 2006 01:05 AM


All times are GMT -5. The time now is 01:29 AM.


Powered by U.S. Legal Forms

Subscribe

Use of the Forums is subject to our Disclaimer which prohibits unapproved advertisements, solicitations or other commercial messages, and false, harassing or abusive statements. All postings reflect the views of the author but become the property of WORLD Law Direct.

Questions and information submitted in the Forums are assumed inquiries for general information and not legal advice.

Copyright 2000-2009 by WORLDLawDirect.com, Inc.