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In the Wake of the MTC’s P.L. 86-272 Project

In August 2021, the Commission adopted revisions to its “Statement Concerning Practices of the Multistate Tax Commission and Signatory States Under Public Law 86-272.”  These revisions explain (among other things) how P.L. 86-272, a federal statute that limits the authority of states to tax out-of-state businesses, applies to businesses that engage in activities via the Internet.

In this article, Brian Hamer, MTC counsel, explains that if states adopt these revisions on a prospective basis while also adopting nexus thresholds, they will protect state revenues, limit burdens on interstate commerce, counter federal preemption of state taxing authority, and provide fair notice to Internet sellers navigating the federal statute’s requirements.

In a previous article , he set forth the legal arguments that support the Commission’s interpretation of the statute. 

 

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