The Taxman Cometh — Even If You’re Not Located There
West Virginia tax authorities have officially jumped the shark (link requires free registration; HT Reason’s Hit and Run via Techdirt):
Last month West Virginia’s Supreme Court of Appeals ruled that MBNA, the credit-card company, must pay West Virginia’s corporate income tax for 1998 and 1999 even though MBNA had no operations there.
All of MBNA’s employees, buildings and other assets were in Delaware, Maryland and elsewhere. Tough, said the court. MBNA had West Virginia credit-card customers, and that was enough.
“This is a big deal,” says Stuart Levine, a Baltimore tax attorney and author of a business law blog.
….. Bank of America, MBNA’s owner since January, may appeal the decision to the U.S. Supreme Court. (A spokesman says it hasn’t decided.)
MAY appeal? Yikes — Any operation that’s national in scope will have to file income tax returns in all states that have a corporate income tax, plus city or county income tax returns in jurisdictions that have them. Any mom-and-pop store that ships anything across state lines will have to worry about the potential state and city income tax implications at the destination.
Mountain Staters, if you think that “almost heaven” is tax chaos and a recession following right behind it, go right ahead.
How is this not an interstate tariff, prohibited in the original Articles of the Constitution?
Comment by triticale — December 28, 2006 @ 8:12 am
#1, I would certainly think so.
Comment by TBlumer — December 28, 2006 @ 9:34 am