Print 35 comment(s) - last by The Raven.. on Oct 15 at 12:39 PM

NC gonna get paid, privacy be damned
NC wants names, addresses, and products purchased for all NC amazon customers

One of the longest running battles between states and online sellers has been the desire for states to capture sales tax revenue on purchases made by its residents. As it is today, taxes are not automatically recovered by a company online unless it has a physical presence in the buyer's home state. State residents, however, are supposed to report these purchases on their state tax returns.

One of the states pressing the sales tax issue the hardest is North Carolina. NC filed a suit against online giant Amazon in April of 2010 seeking to recover what it claims to be $50 million in sales taxes that were not paid by citizens on purchases dating back to 2003. Amazon sued NC in an effort to block the request by the state for Amazon to turn over information about the buying habits of people living in NC on grounds that the information would violate the user's privacy.

Amazon and its customers in NC are getting some help in the legal suit by the ACLU with the group set to go to court this week in Seattle. The ALCU will fight the state's request for specifics on what NC customers purchased online, including names and addresses of the buyers. According to the NC Revenue Department, it, for example, is not seeking specifics about what book a customer purchased, but only wants to know if the customer purchased a book or a CD.

Amazon states that it has already provided the state with purchase details as requested without providing any information about what each of the customers actually purchased. Amazon says that if it turns over names and addresses of the NC residents who made purchases that the state would be able to link the buyer to a specific product purchased.

The ACLU wrote in a statement, "The American Civil Liberties Union will be in federal court in Seattle Wednesday, October 13 to argue that requests by the North Carolina Department of Revenue (NCDOR) for detailed information about purchases made by customers are unconstitutional because they violate Internet users' rights to free speech, anonymity and privacy."

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RE: i wonder
By AlexWade on 10/13/2010 1:21:04 PM , Rating: 4
The Supreme Court ruling of Quill Corp v. North Dakota states that internet state sales tax is illegal unless the business has a nexus, a physical presence, in that state. Use taxes are different, but state sales taxes for interstate commerce are illegal.

Which only makes sense because each state has a measure of sovereignty. Thus the laws in one state do not apply to another state. A business with no physical presence in a state is not subject to another state's laws.

RE: i wonder
By Spivonious on 10/13/2010 1:54:22 PM , Rating: 2
Sorry, I meant use tax above. Although in PA at least, they are the same rate.

If I buy a soda in Delaware (no sales tax), but don't drink it until I'm in PA, I owe the state 6% of the purchase price. If I drink it in Delaware, I don't owe them anything. If I buy it in Maryland (let's say they still have 5% sales tax), and drink it in PA, I owe PA 1%.

I'm sure other states are similar.

RE: i wonder
By jbwhite99 on 10/14/2010 10:56:39 AM , Rating: 2
North Carolina has a use tax as well - the same 7.75% rate (5.25 state, 2.5 county) as sales tax is collected.

Sovereignty is actually challenged, since UPS has locations all over the state, and Amazon did have B&M folks to some extent with their affiliate program.

Bev, go find some other place to get your money.

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