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Court: Borders Web Ops Must Remit CA Sales Taxes

Posted by timothy on from the government-as-organism dept.

ScentCone writes "A rather quiet appellate court ruling finds that Borders must start coughing up sales taxes to California. Even though Borders spun off their online business to a separate company (now run by Amazon), has no employees, physical facilities, banking, or other activity in the state, the court found for California. While this is at first alarming (unless you write e-commerce software, in which case this may be the Programmer Permanent Employment Act), the court's reasoning was that despite the separate structures, the Borders brick-and-morter presence in CA, some overlapping board membership, common logos, cross-promotion, etc., meant that the two divisions were too entangled to fend off CA's army of hungry revenuers. Ramifications could include good old print catalog operators, store-less biggies like Amazon that have partnerships with CA companies, and more."

5 of 360 comments (clear)

  1. "Act"? by Anonymous Coward · · Score: 2, Funny

    While this is at first alarming (unless you write e-commerce software, in which case this may be the Programmer Permanent Employment Act)

    Jeeze, these are activist judges, passing legislation and everything!

  2. I for one... by kmortelite · · Score: 2, Funny

    I for would welcome our new California taxes and uh, uhm, oops. Sorry guys. I have no idea what I was saying.

  3. Re:Not surprising by Anonymous Coward · · Score: 3, Funny

    Essentially the Appellate court side this is one entity masquarading as two.

    As you can see, we've had our eye on you for some time now, Mr. Borders. It seems you have been living..two lives. In one life, you're Borders Bookstores, a respectable retail company....you have brick and mortar stores, you pay your sales taxes, and you... provide free gift wrap. The other life is lived in computers, where you go by the hacker alias Borders.com, and are guilty of virtually every computer crime we have a law for. One of these lives has a future....the other does _not_...

  4. The TAXINATOR by Anonymous Coward · · Score: 1, Funny

    I lie through my teeth and then I crush you with taxes!

    - Governor Arnhuld

  5. Easy Solution... by mertzman · · Score: 2, Funny

    There's an easy way for Borders to get around this ruling... it's called:

    Nevada.

    So close, and yet so far from the California's revenue authorities. ;-)