Feeds

Chicago demands ticket taxes from eBay, StubHub

'You must pay for your amusements'

Build a business case: developing custom apps

The City of Chicago is suing eBay and its secondhand ticket outfit StubHub, claiming they've failed to collect millions of dollars a year in city taxes.

On Monday, as reported by The Associated Press, the city filed separate suits against eBay and its subsidiary, demanding records of their Chicago-area ticket sales. A Chicago ordinance requires businesses to collect taxes on the resale of all tickets to "sporting events, cultural events, and other amusements taking place in the city," and the dual-suits allege that the two online outfits refuse to do so.

eBay did not respond to multiple requests for comment. But according to Jennifer Hoyle, a spokeswoman for the Chicago Department of Law, the company has told the city it's immune to the ordinance. It has also refused to provide records of its online ticket sales, she says.

"One of the big issues is that we don't exactly know what we're losing in taxes. The companies involved have not provided the paperwork that would tell us what we're missing out on," Hoyle told us. "They claim that the ordinance isn't applicable to them."

In addition to asking for records, the suits asks for money. Chicago demands that the two online outfits start collecting and remitting its amusement tax - and fork over some back taxes as well.

As Hoyle points out, the Chicago Municipal Code requires all ticket resellers and all ticket reseller agents to collect the city's amusement tax. The agents bit includes websites, but that wasn't added until September 2006, says Donal Quinlan, a spokesperson for the office of Chicago alderman Edward Burke, who was instrumental in revising the ordinance.

Burke's office estimates that Chicago is missing out on $16m a year in taxes just on the resale of tickets over the net. Or at least, that was the estimate back in 2006.

A pre-Internet-era Supreme Court case says that online businesses aren't required to collect sales taxes unless they have a physical presence in the state where the customer resides. StubHub has offices in Chicago and that may mean that eBay has a physical presence in Illinois as well.

Amazon is now battling physical presence issues in both New York and Texas. ®

5 things you didn’t know about cloud backup

More from The Register

next story
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Premier League wants to PURGE ALL FOOTIE GIFs from social media
Not paying Murdoch? You're gonna get a right LEGALLING - thanks to automated software
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Ballmer quits Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Online tat bazaar eBay coughs to YET ANOTHER outage
Web-based flea market struck dumb by size and scale of fail
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.