CHICAGO IS SUING Ebay and for failing to collect a chunk of amusement taxes on concert and sporting event tickets.
While Ebay sells stuff without really thinking about it, Chicago thinks any little tax it can think of should figure prominently in the auction site's thoughts.
Chicago's amusement tax ordinance, which is designed so that any one who is amused should give money to the city, specifically states that Internet sites that resell tickets should pay up.
The Internet auction leader has told the city to go forth and multiply, claiming the eight percent tax on fun does not apply to it. Ebay is not funny.
Alderman Edward Burke thinks that Chicago could be losing $16 million a year on Internet-based sales by ticket resellers who don't collect the amusing tax.
EBay has said paying taxes could cripple small Internet businesses. In 1992 a US Supreme Court ruling said that states were not allowed to force businesses into collecting sales taxes unless the company has a physical presence in the area. µ
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