Judge blocks Colorado e-commerce tax law

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Denver—A federal judge has granted a request by the Direct Marketing Association to block a Colorado law requiring online sellers to divulge customer purchase information so the state could later pursue those customers for sales tax payments.

The law, HB10-1193, passed in March 2010, targets out-of-state e-commerce companies that don't collect state sales tax on their online transactions with Colorado residents. In addition to divulging customer purchase information, online sellers are also required to provide the state with the names of those who spend more than $500 with them in a year.

Last year, the DMA filed suit against the state, saying the new law is an intrusion on consumer privacy, discriminates against interstate commerce and harms local businesses that are affiliates of the national online sellers. Meanwhile, DMA sought the preliminary injunction to block the law, which U.S. District Judge Robert Blackburn granted on Wednesday.

The American Catalog Mailers Association also lobbied against the law, and is participating in DMA's legal efforts.

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