The ACLU announced yesterday, February 9, that it had settled its case against the North Carolina Department of Revenue over the customer purchase information released by Amazon in response to a DOR request. More information is contained in this Daily Tech article.
Amazon itself filed a similar suit against North Carolina. As we blogged about the ruling in that case last October, the decision was not a clear victory for Amazon. The court ruled that North Carolina has the right to ask Amazon for general information about customer purchases, but not for specific purchase information, such as the titles of books bought by an individual. The court also ruled that North Carolina can pursue Amazon for the sales tax that was justly due to the state. This statement from Beth Stevenson of the North Carolina Department of Revenue explains the fundamentals of the case:
“The case between the North Carolina Department of Revenue and Amazon has long been twisted into something it is not,” said Beth Stevenson, spokeswoman for the North Carolina Department of Revenue. “Bottom line, this is about fairly collecting the tax that is due to the state of North Carolina and nothing more. The Department has always maintained that we do not need—or want—titles or similar details about products purchased by Amazon customers. The department voluntarily destroyed the detailed information that Amazon unnecessarily provided and offered them the opportunity to comply with the state tax laws moving forward.
“The lawsuit on this particular issue could have been avoided altogether if not for the aggressive stance Amazon took to avoid compliance with North Carolina’s tax laws. There would have never been an issue of customer privacy if Amazon would simply collect the North Carolina sales tax that others already do.”
It’s not surprising that North Carolina is trying its best to collect the sales tax that is due on those purchases. This article from Storefront Backtalk says that only 6% of North Carolinians took advantage of North Carolina’s eTail sales tax amnesty program last year.
The Streamlined Sales and Use Tax Agreement (SSUTA)—of which North Carolina is a member—in conjunction with federal legislation such as the Main Street Fairness Act, will eliminate the need for states to craft individual strategies to collect the taxes that are already due them.