COLUMBIA, S.C.—Today, NetChoice filed an amicus brief with the U.S. Chamber of Commerce, Business Roundtable, the South Carolina Chamber of Commerce and the Greater Columbia Chamber of Commerce to the Supreme Court of South Carolina in support of Amazon’s appeal in the case, Amazon Services v. South Carolina Department of Revenue, over the State’s improper taxation of the business.
In 2020, a South Carolina Administrative Law Court interpreted an ambiguous tax statute broadly to mean that Amazon, who is not clearly covered by the tax, had a duty to collect and remit tax on products sold by third-party sellers.
Amazon appealed, arguing that the ALC’s interpretation of the statute was not supported by the text. Holding Amazon liable for online sales, it argued, violated constitutional provisions of fair notice and equal protection.
In January of this year, a South Carolina appeals court affirmed the ALC’s erroneous judgment. His decision would make Amazon liable for over $12 million in taxes on third-party sales made by merchants on its platform, effectively allowing the state to improperly target online transactions to generate more revenue.
Our brief makes three key points:
- The predictability of tax laws is vital to the business community and to the economy as a whole;
- The time-honored rule that ambiguity must be resolved in the taxpayer’s favor supports a fair and predictable tax system; and
- The decision below impairs the predictability of the tax laws by eviscerating that rule.
“A competitive market depends on a clear, predictable tax code. South Carolina’s efforts are the latest among state executives to engage in improper taxation of online businesses by misconstruing tax statutes far beyond their intended meaning,” said Carl Szabo, NetChoice Vice President & General Counsel. “To ensure South Carolina remains hospitable to innovation and commerce, we ask the Supreme Court to reverse the administrative court’s judgment.”
You can read our amicus curiae brief here.
Please contact Krista Chavez at press@netchoice.org with inquiries.