Judge Says Missouri Cities Don’t Have to Repay Taxes

A federal judge has ruled that more than 250 Missouri municipalities and St. Louis County don't have to pay anything to AT&T customers for improperly collected taxes on Internet access.

The Columbia Daily Tribune reports Judge Nanette Laughrey's decision Monday follows years of legal disputes between the governments, AT&T and its customers. A class-action lawsuit filed against the local governments sought millions of dollars from the entities for AT&T surcharges plaintiffs claimed were used to pay an illegal tax.

Carriers did not collect business license taxes until 2008, but a settlement between local governments and wireless providers required the carriers to pay a lump sum for back taxes. Internet tax revenue was excluded from taxable services because of a federal law that bars taxes for online access.