Tenn. state court ruled AOL wasn’t liable for $9.6 million in sta...
Tenn. state court ruled AOL wasn’t liable for $9.6 million in state sales and business franchise taxes state claimed for years 1990-1997. Decision came on AOL lawsuit filed in Tenn. Chancery Court, Davidson County, against Tenn. Revenue Comr. Ruth…
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Johnson. Suit sought to void as unlawful her 1997 attempt to collect back taxes from AOL on Internet access and related services. Judge Ellen Lyle ruled that merely having customers in state wasn’t enough to establish nexus for tax liability. Judge said AOL wasn’t required to collect Tenn. sales tax nor pay business franchise tax because it wasn’t located in state and had no physical presence there. Lyle said move to tax AOL was unconstitutional attempt to interfere with interstate commerce. Revenue commissioner said she may appeal.