Wake County Judge Clarence Horton Jr. ruled against Wal-Mart in a fight over $30 million in corporate taxes the state assessed the company. Though it may be appealed, the ruling means the Department of Revenue has the right to tax companies on property held by related out-of-state entities.
The practical impact is relatively limited for now. Its main effect is to confirm that the Department of Revenue did not need new statutory authority granted under Section 31.18 of the 2007 budget law to tax REITs. The Department and Fiscal Research reported no fiscal impact for that section of the bill.
Extending the argument a bit further, this calls into question the value of legislators’ “doing something” about perceived problems. Legal mechanisms already exist to handle most issues without having to create even more laws.
