North Carolina last month began an audit of online businesses, assuming that millions of dollars in sales taxes owed to the state had disappeared into the Internet.
“This is really an issue of fairness and equity for small businesses, the brick and mortar, corner store operations,” said Kenneth R. Lay, the state’s secretary of revenue. “These businesses are at a competitive disadvantage when they have to collect sales taxes that other businesses do not.”
The response of one of those online businesses, Amazon.com, was succinct: back off.
In a complaint filed in Federal District Court in Seattle, the company said that the audit violated the First Amendment and privacy rights of the customers, as well as the company itself.