Decline of Tax-Free Internet Sales?

June 20, 2005

The New York Times reports on a California legal ruling on the taxation of Internet sales:

Those who believe that death and taxes are the only sure things in life have not spent much time with online retailers, who have largely avoided paying most sales taxes.

But that situation appears to be near an end.

Late last month, a California state appeals court found the bookseller Borders liable for $167,000 in taxes from April 1998 to September 1999 because the company had commingled the operations of its online subsidiary and its stores in that state. The ruling, along with other efforts by state tax collectors aimed at Internet sales, could signal that the era of tax-free online shopping is drawing to a close.

Read the full story here.


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