Weekly Round-Up: State Tax Litigation Headed to the U.S. Supreme Court


Highlights from the 12/23/16 issue of the Weekly State Tax Report :

  • Supreme Court Receives Final Plea to Review Retroactive Law
    The U.S. Supreme Court has received warning that allowing Washington's retroactive stripping of a tax exemption may lift all limits to retroactive tax legislation. Dot Foods Inc. has challenged a Washington Supreme Court ruling that the retroactive application of a statutory amendment narrowing a business and occupation tax exemption didn't violate due process.
  • Amazon Set to Collect Louisiana Sales Tax in 2017
    Amazon.com Inc. will begin collecting and remitting state and local sales tax on purchases shipped to Louisiana in 2017, after the state's new tax regime was implicitly endorsed by a recent U.S. Supreme Court ruling. The high court earlier this month declined to review a Colorado law that imposes reporting and notification requirements on out-of-state retailers, a law similar to one passed in Louisiana in July.
  • Moody's Whistle-Blower Case Will Proceed: New York Court
    A whistle-blower case alleging that Moody's Corp. abused the tax-advantaged structure of a subsidiary captive insurance company can proceed in state court. The Supreme Court of the State of New York, New York County, denied Moody's motion to dismiss, ruling that a former employee of the company can proceed with his case under the state False Claims Act.
  • Michigan Must Soon Respond in High Court Retroactive Tax Suits
    The Michigan Department of Treasury must respond within the next few days to petitions to the U.S. Supreme Court by Sunoco, Goodyear and other businesses seeking the return of more than $1 billion in taxes paid. Sunoco Product Co., Goodyear Tire & Rubber Co., IBM Corp, Gillette Commercial Operations North America, DIRECTV Group Holdings Inc. and Skadden Arps Slate Meagher & Flom LLP, all out-of-state taxpayers, are contesting Michigan Court of Appeals rulings that allow the state to retroactively apply a law enacted in 2014 to taxes paid since 2008.
  • California Tax Dollars Would Suffer Under ACA Repeal
    California's fight to save the Affordable Care Act is bolstered by new statistics on what a repeal of the federal health-care law would do to the Golden State's economy. Repealing the Affordable Care Act would cost California $20.3 billion in gross domestic product, 209,000 jobs and $1.5 billion in tax revenue, a University of California Berkeley report said.

Some notable developments from the State Tax Developments Tracker —Bloomberg BNA’s tool for monitoring important developments in all the states:

  • North Carolina Supreme Court Affirms Trial Court's Judgment, Finds Taxpayer Not Excluded Corporation Entitled to Utilize Single-Factor Tax Allocation Formula
  • Illinois General Assembly Enacts Law Concerning Craft Distillers
  • Iowa Treasurer of State Adopts Amendments to Rules Concerning Iowa Educational Savings Plan Trust
  • Pennsylvania Board of Finance and Revenue Grants Sales and Use Tax Refund Petition, Finds Contested Transactions Non-Taxable


For more information about this and other state tax issues, sign up for a free trial of the Bloomberg BNA Premier State Tax Library.

In other developments …  

A Taxing Review of the Twelve Days of Christmas by the Tax Foundation


California – Cable system and home shopping network not unitary; income from termination fee satisfied transactional test for business income by PwC

Compiled by Lauren E. Colandreo