For Immediate Release: Tuesday, October 9, 2012
U.S. Supreme Court declines review of Scholastic case
Hartford – The State of Connecticut claimed a victory for tax fairness today when the U.S. Supreme Court let stand a decision requiring Missouri-based Scholastic Book Club Inc to collect and remit sales tax in Connecticut. By deciding not to hear the case, the U.S. Supreme Court let stand a decision by the Connecticut Supreme Court, which found that Scholastic has sufficient presence in the state to be subject to the same sales tax provisions as Connecticut retailers.
Department of Revenue Services Commissioner Kevin B. Sullivan said of the decision, “The Department has long believed that the use of schoolteacher representatives by Scholastic provided sufficient nexus within Connecticut to uphold taxability. This decision levels the playing field for Connecticut-based retailers who rightly collect and remit the sales tax.”
The Connecticut Supreme decision was based on the fact that about 14,000 Connecticut classroom teachers solicit, process, and deliver book sales to students on behalf of Scholastic, essentially acting as representatives of the company. Teachers do not receive monetary compensation from Scholastic for their work, but they are the only avenue for students and their families to receive catalogues, submit orders and payments, and collect the delivered items.
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