North Carolina mines for Amazon tax

In a State’s Search for Sales Tax, Amazon Raises Privacy Concerns


NORTH CAROLINA last month began an audit of online businesses, assuming that millions of dollars in sales taxes owed to the state had disappeared into the Internet.

“This is really an issue of fairness and equity for small businesses, the brick and mortar, corner store operations,” said Kenneth R. Lay, the state’s secretary of revenue. “These businesses are at a competitive disadvantage when they have to collect sales taxes that other businesses do not.”

The response of one of those online businesses, Amazon.com, was succinct: back off.

In a complaint filed in Federal District Court in Seattle, the company said that the audit violated the First Amendment and privacy rights of the customers, as well as the company itself.

The case offers a glimpse at the changed landscape of privacy in the United States. Under the old model, the law was meant to protect the public from a snooping government. And the government was generally the only entity with the resources to snoop on people in a systematic way.

Today, the online snooping (make that “data collection”) never stops. Can the old tools really prevent the government from closely monitoring its people when so much information is a mere Internet search away? And is the government the one we really need protection from?

Amazon’s lawyers say the Constitution protects the company so that it “may sell — and customers may read, hear or view — a broad range of popular and unpopular expressive materials with the customers’ private content choices protected from unnecessary government scrutiny.”

The complaint gave examples of books Amazon had shipped to North Carolina: “Bipolar Disorder: A Guide for Patients and Families,” by Francis Mark Mondimore, and “He Had It Coming: How to Outsmart Your Husband and Win Your Divorce,” by Stacy Schneider. The movies, the complaint said, included “Lolita,” “Brokeback Mountain” and “Fahrenheit 9/11.”

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