NASHVILLE - Tennessee officials will be able to continue their court fight to compel out-of-state internet retailers and catalog companies to collect state sales taxes.
Representatives this morning voted 73-1 to give final approval to an "omnibus" bill containing various departmental rules.
Among the rules is Gov. Bill Haslam's effort to force remote sellers with no physical presence in Tennessee to collect and remit state and local sales taxes.
The final approval comes as the General Assembly rushes to wrap up its annual legislative session today.
The tax rule, which has already been challenged in state court by trade groups for internet retailers and catalog companies, ran into trouble in the House earlier in the week.
But House GOP critics were mollified by an amendment. It says the state Revenue Department "shall be prohibited from collecting any internet sales or use taxes" under either the rule or subsequent court rulings until it has "been fully reviewed" and "approved" by the General Assembly under the departmental rules approval process.
Senators on Tuesday approved a slight change in phrasing that made no substantive change in intent or effect. That brought that and the entire rules package bill containing some 170 or so rules back to the House for concurrence.
Officials in Tennessee and other states are pushing similar remote-seller sales tax collection rules and laws in hopes of ultimately pushing the U.S. Supreme Court to revisit its 1992 pre-e-commerce ruling involving remote sellers.
Tennessee, North Dakota and Alabama are pushing the issue, but officials in the Volunteer State say Tennessee has a unique story in that unlike the other states, it has no income tax and is highly sales-tax dependent.
Legal battles in state and federal courts are expected to take as long as seven years before reaching the nation's highest court where Justice Anthony Kennedy has said he's open to looking at the issue anew.