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Online Sales Tax Case Continues
Published on 11/05/2010
An appeals court reinstated a lawsuit filed by these companies that alleges that the online sales tax is unconstitutional. They found that the lawsuit had been erroneously dismissed and that the 2008 lawsuit should move forward.
The state of New York justifies the law stating that giving ecommerce business tax breaks would give them an unfair edge over brick and mortar retailers which must pay sales tax.
In the appellate decision, however, the court ruled that parts of the tax are constitutional.
Only four other states have similar tax laws against online retailers. Ecommerce companies typically do not have to pay tax on shipments sent outside of their state although 16 states have contemplated enacting stricter tax laws in the past year.
