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Multistate Tax  |  June 23, 2023
State Tax Matters
State Tax Matters
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Sales/Use/Indirect:
California: US Supreme Court Denies Trade Association’s Petition to Review Remote Seller Case

Docket No. 22-1076, US (cert. denied 6/20/23). The US Supreme Court denied a trade association’s petition to review whether it may pursue a challenge in federal court against California’s attempt to collect sales tax from its online remote seller members whose inventory was held in a nonaffiliated marketplace facilitator’s in-state warehouses. Specifically, the trade association had asked whether:

  1. The federal Tax Injunction Act (TIA) applies differently based on whether the plaintiff is a putative taxpayer or a “third party,” and
  2. Plaintiffs who cannot challenge tax information demands in state court have an adequate remedy to challenge those demands in state court.

In the underlying case, the trade association argued, among other claims, that California’s attempts to collect sales tax from its online merchant members on their sales to in-state residents before October 2019 violated their rights under the US Constitution and the federal Internet Tax Freedom Act given that their contacts with California were limited to in-state storage of merchandise. In 2022, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal of the lawsuit to enjoin collection of California sales and use taxes as being barred by the TIA [see Case No. 21-16911, US 9th Cir. (November 9, 2022) for more details on the Ninth Circuit’s ruling]. Please contact us with any questions.

 

—

Galina Philipovitch (San Jose)

Managing Director

Deloitte Tax LLP

 

Hal Kessler (San Francisco)

Managing Director

Deloitte Tax LLP

 

Rick Heller (Morristown)

Managing Director

Deloitte Tax LLP

 

Brian Wiggins (Sacramento)

Senior Manager

Deloitte Tax LLP

 

Karri Rozario (Sacramento)

Senior Manager

Deloitte Tax LLP

Evita Graciela Lopez (Costa Mesa)

Senior Manager

Deloitte Tax LLP



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In this issue

Colorado DOR Issues Updated Implementation Guidance on Elective Pass-Through Entity Tax Colorado DOR Proposes Rule Changes on Federal Conformity and QBI Deduction Addback Vermont: New Law Creates Payroll Tax and Requires Employers to Withhold and Remit It West Virginia Tax Division Proposes Rules Implementing New Elective Pass-Through Entity Tax


California: US Supreme Court Denies Trade Association’s Petition to Review Remote Seller Case Kentucky DOR Issues Newsletter Summarizing Recent Changes on Taxability of Services Louisiana: New Law Requires Board to Implement Uniform Electronic Tax System for Localities Missouri: Adopted Rule Amendments Reflect Post-Wayfair Nexus Standard for Vendors North Carolina: US Supreme Court Denies Review of Case Disregarding Dilworth and Upholding Constitutionality of Taxation


Rhode Island: New Law Includes Statewide $50,000 Exemption from Tangible Property Tax Wisconsin: New Law Removes Taxes Levied on Personal Property Including Business Equipment


Nebraska enacts pass-through entity tax election




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