New York State's Internet Sales Tax provision, which went into effect on June 1, 2008, has recouped $46 million in sales tax revenue from the 30-plus vendors that registered to collect and remit sales tax, according to a spokesperson for the New York State Department of Taxation and Finance. The state expects to collect about $68 million for the fiscal year 2009 - 2010, which begins April 1.
"This is not only good news for New York State, but for other states where similar Internet Sales Tax legislation has been introduced," said ABA COO Oren Teicher. "Importantly, the fact that over 30 vendors registered under the Internet Sales Tax provision clearly disputes any notion that this provision was merely the 'Amazon tax.' As we have stated from the beginning of our efforts, the Campaign for E-Fairness was never about any particular retailer, it was always about what's fair -- and that's treating every retailer equally under existing laws."
New York State's Internet Sales Tax provision was signed into law on April 15, 2008, by Gov. David Paterson. The provision requires out-of-state retailers with nexus in the state -- via a warehouse, office, sales agent, or online affiliate -- to comply with New York State sales tax laws and to collect and remit sales tax on sales to state residents. Soon after, both Amazon.com and Overstock.com challenged the provision in New York State Supreme Court in Manhattan.
However, in a significant victory for the state's independent retailers, in January 2009, a judge dismissed the lawsuit filed by Amazon.com. A similar lawsuit by Overstock was also dismissed. Both Overstock.com and Amazon.com have filed notices of appeal.
Since the dismissal of the Amazon.com and Overstock.com challenges, five states have introduced legislation based on the New York Internet Sales Tax provision: California, Connecticut, Hawaii, Minnesota, and Tennessee. ABA is calling on its members in these states to urge their lawmakers to support their respective Internet Sales Tax provisions. (Learn more.) --David Grogan