TALLAHASSEE, Fla. – The U.S. Supreme Court on Tuesday declined to take up a constitutional challenge to Florida collecting sales taxes on flowers that are ordered online from a Palm Beach County company but are delivered out of state.
The Supreme Court, as is common, did not give reasons for turning down the appeal by American Business USA Corp., a Wellington firm. But the move effectively kept in place a ruling last year by the Florida Supreme Court in favor of the state Department of Revenue.
American Business USA argued that it should not be subject to Florida sales taxes, as it did not have an inventory of flowers in the state and used out-of-state florists to fill orders that had been placed online.
The state 4th District Court of Appeal in 2014 sided with the firm, finding that Florida "impermissibly burdened interstate commerce" when it tried to collect taxes on flowers and other items delivered out of state. But the Florida Supreme Court overturned that decision.
In asking the U.S. Supreme Court to hear the case, attorneys for American Business USA warned of potentially broad ramifications of the ruling by the Florida high court.
"The present case is important because the Florida Supreme Court's newly announced power has no limiting principle," the attorneys wrote in an October brief. "If a state may tax flower sales based only on the state's connection to the internet retailer who accepts the order, then nothing will constrain the spread of this power to all e-commerce transactions. As a category, flowers are indistinguishable from other types of tangible personal property."
But Attorney General Pam Bondi's office argued the U.S. Supreme Court should turn down the case and described the issues in much-narrower terms.
"As the Florida Supreme Court recognized, Florida's unremarkable imposition of sales tax liability on a business incorporated in Florida, residing in Florida, headquartered in Florida, and conducting sales operations in Florida fits well within the scope of state taxing authority, regardless whether the goods in question originate in or are delivered out of state," attorneys in Bondi's office wrote in a January brief.
One of the legal issues in the case involved whether there was a "nexus" between the company's sales and the state. The Florida Supreme Court found that such a nexus existed.
"(The) record shows that American Business does have a physical presence in Florida --- it is headquartered in Wellington, Florida, and has been doing business in Florida since 2001," Florida Chief Justice Jorge Labarga wrote. "From its Florida location, American Business accepts internet orders and arranges for delivery of out-of-state flowers and tangible personal property. Based on the facts of this case, we find that the 'substantial nexus' test is met."