Edward Zelinsky (Cardozo) has posted The Siren Song of State Amazon Laws: The Colorado Example, 59 State Tax Notes ___ (2011), on SSRN. Here is the abstract:

In Direct Marketing Association v. Huber, Judge Robert E. Blackburn of the U.S. District Court for the District of Colorado preliminarily enjoined the executive director of Colorado’s Department of Revenue from enforcing Colorado’s new “Amazon” law. Judge Blackburn‘s decision enjoining the enforcement of Colorado’s Amazon law indicates the futility of state efforts to collect use taxes on internet and mail order purchases absent federal legislation authorizing such efforts. The only (and overdue solution) is for Congress to enact federal legislation overturning Quill Corp. v. North Dakota, [504 U.S. 298 (1992),] thereby permitting the states to enforce use tax collection responsibilities on out-of-state sellers including those sellers which lack physical presence in the taxing state.

It is unsurprising that Amazon laws appeal to legislators and governors scrambling for tax revenues in a challenging budgetary environment. However, Judge Blackburn’s opinion confirms that, under current law, Amazon laws like Colorado’s are fiscal siren songs, seductive but ultimately forbidden.