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New York Goes After Sprint-Nextel For Sales Tax Underpayment

Sprint-Nextel Corporation is being sued by New York. New York Attorney General Eric Schneiderman has filed a claim that Sprint “…under-collected and underpaid $100 million in sales taxes to keep prices down.”

Mobile phone companies doing business in New York are required to collect and pay sales taxes on the “…full amount of their monthly access fees for calling plans.” New York has required this since 2002, but “Schneiderman says Sprint since 2005 underpaid the tax and submitted false records.”

The suit is filed under the “False Claims Act” which can carry penalties and fees that would triple the amount owed. The Attorney General states that Sprint was aware of the issue and “…has not changed its practice, while competitors Verizon, AT&T, T-Mobile, and MetroPCS pay the tax.”

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Susan McLain
Avalara Author Susan McLain
Susan McLain began her career as a technical writer in technology industries such as satellite networking and medical devices. Her skills encompass technical and marketing writing, usability engineering, verification and validation testing and protocol writing, requirements development, business analysis, technical illustration/graphic design and marketing. She has owned her own business providing service to small to medium sized business and in other positions, she has been in project management, documentation and marketing. She is currently the content specialist for Avalara helping to “make sales tax less taxing.”