US Supreme Court lets Equifax tax ruling stand

Court Alerts

The U.S. Supreme Court said Monday that it won't hear an appeal from credit bureau Equifax Inc. involving what it considered an adverse tax ruling in Mississippi.

The appeal was a reaction to a 2013 Mississippi Supreme Court decision that Equifax had to prove that it didn't earn any taxable income in the state. The state Department of Revenue examined Equifax's income and allocated some to Mississippi, ruling it owed taxes and penalties.

The Mississippi court upheld the Revenue Department's calculation of the company's taxes based on revenue earned in Mississippi, thus increasing its tax liability from zero to over $700,000, according to court documents.

The Council on State Taxation, Georgia Chamber of Commerce and The Institute for Professionals had filed "friend of the court" briefs in the case.

Lawmakers responded during the 2014 session by passing a law to change how the state collects taxes.

A key part of the law could make it harder for the state to rule that multistate corporations are paying too little in taxes to Mississippi. It says the Department of Revenue would have to present clear and convincing proof before it could reallocate how a company splits its income among states, and only do so in "limited and unique, nonrecurring circumstances."

The Department of Revenue estimates all changes in the law, including a phase-in of lower interest rates for overdue taxes, will cost Mississippi $100 million a year.

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