Court rules, in part, against North Carolina online sales tax

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Online retailers got a win this week. A US district court ruled that Amazon.com does not have to reveal lists that identify books, music and movies bought by individual consumers to tax collectors in North Carolina.

Amazon said in a lawsuit that filing such information with the North Carolina Revenue Department would harm its customers by exposing what products they bought from the company. The state – and others that created similar laws – argue that online retailers with out-of-state headquarters should pay taxes similar to in-state bricks-and-mortar businesses.

However, lawmakers in Colorado, where a similar law was passed, said the ruling gives them, and every other state, the authority to create near-identical laws that do not ask for specific information on products purchased.

The Denver Post newspaper opposed the Colorado version of the tax, saying that “until Congress finds a national solution to the problem, we worry Colorado's attempt likely will lead to lengthy court battles and headaches for taxpayers.” The National Retail Federation has also lobbied for a national version of the law.

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