New York Hits Sprint With $300 Million Lawsuit Over 7 Years Of Tax Dodging [Update: Sprint Responds]

Next Story

Decide.com Launches Daily Deals; Offers Price Guarantees On Select CE, Home Appliance Purchases

Sprint’s had its fair share of problems to deal with as of late, but who knew one of them would be taxes? According to a new flurry of new reports, New York Attorney General Eric Schneiderman has filed a $300 million lawsuit against Sprint for (among other things) non-payment of taxes, and falsifying official tax documents.

According to Reuters, Sprint failed to collect (and subsequently pass along) over $100 million of taxes from their customers over the past seven years. Schneiderman, who is picking up where a whistle-blower lawsuit filed against the carrier early last year, is seeking three times the amount of Sprint’s underpayment plus additional penalties for good measure.

It’s quite a shift for Sprint, considering that they attempted to position themselves as the good guy looking out for consumer interests during the AT&T/T-Mobile merger proceedings. Sure, while Sprint customers may have unknowingly enjoyed an illicit price break on their phone bills, that’s certainly not going to keep up for much longer.

Schneiderman alleges that Sprint’s non-payment of taxes was all part of a plan to lure customers away from larger wireless rivals like AT&T and Verizon. If true, it strikes me as a terribly misguided way to attract new subscribers — potential public relations nightmare aside, customers’ bills are only going to up now, which probably won’t garner much appreciation from the carrier’s existing users.

I’ve reached out to Sprint representatives for comment, but have not received a response at time of writing. I imagine they’re working on a more thoughtful statement than “Whoops, we goofed,” so keep your eyes peeled — I’ll be updating the post as soon as I learn more.

UPDATE: A Sprint representative has reached out with the following statement, which to no one’s surprise denies everything.

“This complaint is without merit and Sprint categorically denies the complaint’s allegations. We have collected and paid over to New York every penny of sales taxes on mobile wireless services that we believe our customers owe under New York state law. With this lawsuit, the Attorney General’s office is claiming New York consumers, who already pay some of the highest wireless taxes in the country, should pay even more. We intend to stand up for New York consumers’ rights and fight this suit.”