New York ruling on sales tax collection by online retailers will stand
WASHINGTON — The U.S. Supreme Court on Monday let stand a ruling from New York’s highest court requiring Internet retailers to collect sales taxes even if they have no physical presence in the state.
As is their custom, the justices gave no reasons for their decision not to hear the case, which involved Amazon.com, the online giant, and a smaller competitor, Overstock.com. The two companies challenged a 2008 state law that required online companies to collect sales taxes on purchases made by New York residents.
Brick-and-mortar companies often complain that they are put at a competitive disadvantage when they are required to collect sales taxes and online companies are not.
In March, the New York Court of Appeals ruled that the companies had a sufficient presence in the state because of affiliated independent sites that linked to the retailers in return for a commission. “The bottom line,” Chief Judge Jonathan Lippman wrote for the majority, “is that if a vendor is paying New York residents to actively solicit business in this state, there is no reason why that vendor should not shoulder the appropriate tax burden.”
The chief judge added that it might be time to reconsider the basic rule that states may not collect taxes from out-of-state companies without some physical presence in the state, a principle recognized by the U.S. Supreme Court in its 1992 decision in Quill Corp. v. North Dakota.
“The world has changed dramatically in the last two decades,” Lippman wrote, “and it may be that the physical presence test is outdated. An entity may now have a profound impact upon a foreign jurisdiction solely through its virtual projection via the Internet. That question, however, would be for the United States Supreme Court to consider.”
Monday’s order indicated that such reconsideration must wait.
—Adam Liptak, The New York Times
Brussels to investigate deal for UK nuclear plant
LONDON — European regulators said Monday they expected to conduct a full inquiry into a deal to build Britain’s first nuclear power station since 1995, threatening delays that could undermine investment plans for the 16-billion-pound project.
The concern in Brussels is that the terms of the contract might involve British government subsidies that violate European competition rules. The issue would be whether the rates the government has guaranteed to the power plant’s operators for 35 years would distort the market for electricity in the European Union.
“We are starting to analyze what is in the British proposal,” the European competition commissioner, Joaquín Almunia, said at a Brussels conference on Monday. “Probably we will open a formal investigation,” he said. His comments, which were reported by Reuters, were confirmed by Almunia’s office.
Almunia said he had received formal notification from Britain two or three weeks ago about the agreement reached in October with EDF, the French state-controlled utility, to build the plant at Hinkley Point in southwest England.
The European Commission, which is the antitrust regulator for the 28-nation European Union, is empowered to ensure that the bloc’s single market is not distorted by state subsidies.
However, the deal is controversial within Britain, as well, not only because it gives the French company EDF guarantees of profit from the electricity generated — whose rates will be paid mainly by Britons — but also because the deal would open the door to financing from China. EDF is working out an agreement with two large Chinese state nuclear companies to take 30 to 40 percent of the project.
Because no other deal of this type has been put before European regulators, the outcome is unpredictable.
—Stephen Castle and Stanley Reed, The New York Times
Derailed train being pushed, not pulled, revives safety question
NEW YORK — To any engineer on the Metro-North Railroad’s Hudson line, the stretch where a train derailed Sunday was well-known: It includes one of the sharpest curves in the system, with tracks swinging east along the Harlem River, splitting from an Amtrak corridor that remains on a relative straightaway beside the Hudson River.
The maximum allowable speed, according to the Metropolitan Transportation Authority, falls to 30 mph, from 70 mph, for trains going along the curve. It is unclear how fast the train was going Sunday morning, but an MTA official said the train’s operator reported that when he realized it was heading into the curve too quickly, he “dumped the brakes,” an emergency maneuver, and though the train slowed somewhat, it then derailed. It was too early to tell whether the investigation would corroborate that account, and if so, whether the operator or another factor was responsible for the speed.
Officials said the crash’s cause might not be known definitively for days, if not longer. But the derailment raised a series of questions about what might have contributed to the only accident resulting in passenger deaths in Metro-North’s history.
Dumping brakes is a last-resort move typically reserved for averting collisions with other trains or cars stuck at crossings, said Grady C. Cothen, a retired federal railroad regulator. “If he did that, then it would have been an act of considerable alarm,” Cothen said.
The train, which was heading south to Grand Central Terminal, was operated under a so-called push-pull model: For northbound trips, it is pulled from the front by a locomotive; for southbound trips, it is pushed from the rear.
The setup has been adopted widely because of its practicality: Trains do not need to turn around if the locomotive can remain in the same position at the end of a line. The arrangement is used often on the Metro-North Railroad, though not on the Long Island Rail Road, said Aaron Donovan, a spokesman for the transportation authority.
But rail safety experts have at times questioned the performance of push-pull systems in the event of derailments, wondering whether accidents were exacerbated by the force from the rear.
—Matt Flegenheimer and Patrick Mcgeehan, The New York Times