Open/Close
Close

In The news

Chris Lutz - a man in a business suit, smiling at the camera
Christopher T. Lutz
Chair | State and Local Tax Group
Add to eBriefcase
Share

Christopher T. Lutz Discusses the Latest Decision in Ooma Inc. v. Oregon Department of Revenue with Tax Notes

Tax Notes Today State 06/24/2022
Chris Lutz - a man in a business suit, smiling at the camera
Christopher T. Lutz
Chair | State and Local Tax Group
" "

The following excerpt is from Andrea Muse’s article, “SCOTUS Won’t Hear VolP Provider’s Challenge to Oregon 911 Tax” published by Tax Notes on June 22nd, 2022. Read the full article by Tax Notes here (subscription required).

Regarding Ooma Inc. v. Oregon Department of Revenue, the U.S. Supreme Court recently denied Ooma’s petition for certiorari, letting the Oregon Supreme Court ruling stand. In December 2021, the state supreme court ruled the provider is required to collect and remit the state’s 911 tax.

Christopher T. Lutz, Chair of HMB’s State and Local Tax Group, told Tax Notes Ooma raised a fair question in its cert petition. He said that in addition to addressing South Dakota’s sales and transaction thresholds, the Court also noted that the remote sellers in Wayfair were “large, national companies that undoubtedly maintain an extensive virtual presence.”

“The qualitative analysis Justice Kennedy performed in Wayfair has gone completely ignored, and states have simply replaced one bright-line rule (physical presence) with another (economic nexus), so it’s appropriate for the Court to discuss whether satisfying the thresholds employed by South Dakota is sufficient to assert nexus,” Chris said.

Ooma contends that a virtual presence test must be satisfied for a state to assert nexus, according to Chris, but he added that while this “narrow reading certainly finds support in the Wayfair decision,” he thinks the Court was really trying to articulate a “totality of the circumstances” test.

Wayfair was only decided about four years ago, so I don’t read too much into the Supreme Court not taking this case,” Chris commented. “In the meantime, however, states will likely continue to construe Wayfair’s holding in the broadest way possible.”

Read the full article by Tax Notes here (subscription required).

500 West Madison Suite 3700
Chicago IL 60661

Phone: 312-606-3200 Fax: 312-606-3232
© HMB Legal Counsel 2022. All Rights Reserved.
Close