10th Circuit Upholds Colorado’s “Amazon Tax” Disclosure Law

In 2010, Colorado’s enacted “An Act Concerning the Collection of Sales and Use Taxes on Sales Made by Out-Of-State Retailers” which provided that out of state retailers exempt from collecting sales tax:

  • Must provide “transaction notice” to purchasers that they may be subject to Colorado use tax(1) to send a “transactional notice” to purchasers informing them that they may be subject to Colorado’s use tax;
  • Send purchasers who buy in excess of $500 an annual purchase summary and remind the consumer of their obligation to pay use tax; and
  • Send annual report to state listing names, addresses and amounts sold.

The Direct Marketing Association (“DMA”) successfully challenged the law, but the 10th Circuit held the court lacked jurisdiction to enjoin enforcement of the law under the Tax Injunction Act – a position reversed by the Supreme Court.  See prior posts here and here.

In February, the 10th Circuit reversed two lower court determinations that Colorado law discriminated against interstate commerce and last month, the court rejected the DMA’s petition for en banc review.

The decision is below, followed by a presentation on the decision I will be making at the Internet Law Leadership Summit later this week.