Justices To Weigh In On Taxes On Online Flower Sales

TALLAHASSEE (CBSMiami/NSF) - Florida Supreme Court justices will tangle next week with a constitutional question about whether Florida should be able to collect sales taxes on flowers ordered online and delivered in other states.

The Department of Revenue is asking the Supreme Court to overturn an appeals court ruling last year that said it is unconstitutional for the state to try to collect sales taxes from a Palm Beach County company for flowers that brighten the days of people outside Florida.

"These transactions frequently provide joy to those receiving bouquets, but they can present thorny issues for sales tax purposes," a Supreme Court brief filed by Attorney General Pam Bondi's office said. "Who is the seller? Is it the florist initially receiving the order? That florist promises the delivery in exchange for the customer's order. Or is it the florist preparing the flowers? That florist receives payment from the first florist in exchange for arranging and delivering the flowers. Where did the sale take place? Was it where the customer placed the order with the initial florist, was it where the initial florist made arrangements with the second florist, or was it where the second florist delivered the flowers? And who had legal title to the flowers? And when?"

The 4th District Court of Appeal sided last year with American Business USA Corp., which takes online orders for flowers delivered in Florida, other states and other countries. The appeals court found that collecting the sales tax on flowers delivered outside of Florida violated what is known as the "dormant Commerce Clause" of the U.S. Constitution. Broadly, that legal concept is aimed at preventing state actions that interfere with interstate commerce.

Attorneys for the Department of Revenue appealed to the state Supreme Court, which is scheduled to hear arguments Nov. 5.

In a brief, attorneys for American Business USA said the issue comes down to "where the sale is consummated."

"The sale of delivery flowers here is consummated at delivery, and that delivery occurs outside the state of Florida,'' the brief said. "Similarly, the consumer placing the order is not in Florida, the vendor filling the order is not in Florida, the flowers are not in Florida, and the end user is not in Florida. Nonetheless, the florist tax purports to assess a sales tax concerning out-of-state persons, property, and transactions to which the state of Florida has no connection."

But Bondi's office, representing the Department of Revenue, pointed in part to the company operating in Florida.

"Florida has a substantial nexus with the florist's sales because the florist's sole physical presence is in Florida and the florist's sales activities took place in Florida," the state's attorneys wrote. "Indeed, everything the florist did took place in Florida. This is enough to establish a substantial nexus."

The News Service of Florida's Jim Saunders contributed to this report.

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