Sprint must defend itself on charges it knowingly submitted false tax statements and filed to collect sales tax after the New York Court of Appeals on Tuesday rejected the carrier’s bid to toss out a $300 million court suit brought by New York Attorney General Eric Schneideman.
By a vote of 4-1, the court found that it was “unambiguous” that New York law sets taxes on voice services sold for a fixed periodic charge and rejected Spring’s stance that the federal Mobile Telecommunications Sourcing Act preempted the state’s law and that the punitive nature of penalties under the state’s False Claims Act violates, the U.S. Constitution, reported Law360.
“Today’s ruling is an important victory that clears the way for our office to seek nearly $400 million in back taxes and penalties from Sprint,” Schneiderman said. “There has to be one set of rules for everyone, no matter how rich or how powerful, and that includes the biggest corporations paying their fair share of taxes.”
In a brief statement on Tuesday, Sprint spokeswoman Stephanie Vinge Walsh said that the company is “disappointed in the appellate court’s decision” and considering its legal options, reported Law360.
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