May
New online sales tax law results in Amazon suing New York state
Online mega retailer Amazon isn’t at all happy with a new tax law passed in New York state. So much so, in fact, Amazon is letting loose their legal department and have launched a lawsuit against the northeastern state to have the new law declared illegal. The nexus of the dispute? It’s all about collecting sales taxes.
A new law recently passed in New York demands that online retailers now must collect sales tax for purchases made by residents living in the state. Called by some state officials, as the “Amazon Tax, ” this new tax law has Amazon officials saying, “No thanks,” so to speak. Amazon lawyers have written in their complaint to the New York State Supreme Court that the new law violates the equal protection clause of the New York state and U.S. constitutions by intentionally targeting the online retailer. Also declared in the filing, Amazon states they do not have a “substantial” physical presence in New York and therefor cannot be held to collect taxes as they don’t own or lease property in the state.
We’ll be watching to see where this legal battle goes as it may have implications for all online retailers depending on the outcome. In 1992 there was a Supreme Court case (Quill v. North Dakota) that restricts states from requiring companies to collect taxes from customers unless the company has a physical presence in that state. So at least by way of legal precedent, this new tax law in New York might not stand up in Supreme Court.
Read more at CNET.
Tags: players, Hi-fi, video games, tech