Idaho Newspaper Seeks Records Related to Retailer's Tax Exemption

By: The Idaho Statesman says the public has a right to know why the Idaho Tax Commission granted outdoor retailer Cabela's a sales tax exemption for online and catalog sales.

At a court hearing Monday, the newspaper argued for the release of tax commission records and other details related to its approval of Cabela's special request.

"Because we are an open society, Idaho taxpayers have a right to know why there is a disparity in treatment and a right to know why this large corporation obtained its special status," Chuck Brown, the newspaper's lawyer, told 4th District Judge Michael McLaughlin.

The newspaper is suing the tax commission after the agency denied a public records request earlier this year.

State law says companies that have a substantial presence in the state must begin collecting sales tax from online and catalog customers. But Cabela's sought an exemption, arguing that the "substantial presence" provision did not apply because the retail operation is a separate company from its online and catalog division.

The tax commission agreed and granted the exemption.

The Nebraska-based retailer opened its first Idaho store last August in Boise and has a history of seeking such tax concessions from states where it has opened brick-and-mortar stores. Cabela's has a $1 billion online and catalog business and has won similar exemptions in 19 other states.

The tax commission contends that information contained in Cabela's application meets the standard for protected tax information.

Deputy Attorney General Ted Spangler, representing the tax commission, cited two documents in question: a request from the company asking the commission about its exempt status and the agency's ruling. As part of its review, Spangler said the commission ordered Cabela's to disclose the same information required for an audit or tax return.

The tax commission is providing the documents to the judge for review.

"If you look at the ruling, you'll see a lot of discussion of how this particular taxpayer goes about doing business," Spangler said.

Brown contends the newspaper has no interest in the company's private tax information, just agency materials related to the Cabela's request.

McLaughlin said he would review the documents before ruling.