BCN Telecom, Inc. v. State Tax AssessorAnnotate this Case
BCN Telecom, Inc. was assessed a state service provider tax on certain flat charges that BCN imposed on some business customers’ lines from 2008 to 2011. The charges were designed both to reimburse BCN for presubscribed interexchange carrier charges that it paid to access local telephone infrastructure and to generate profits. The Sales and Use Tax Division of Maine Revenue Services affirmed the assessment. The Maine Board of Tax Appeals affirmed. On judicial review, the superior court granted summary judgment in favor of BCN, concluding that BCN’s charges were not part of the “sale price” of telecommunications service and that, even if they were, they were exempt from taxation under Me. Rev. Stat. 36, 2557(34) because they were charges for interstate telecommunications services. The Supreme Judicial Court vacated the judgment entered by the superior court, holding (1) the amounts received by BCN were subject to the service provider tax as part of the sale price for telecommunications services; and (2) BCN failed to provide prima facie proof that the tax exemption for interstate telecommunications services applied as a matter of law to these charges.