The Texas Court of Appeals held that Alpine was properly held to be liable for sales tax on units sold in Texas. The company argued that its distributors were independent contractors and did not meet the state's definition of a direct sales organization as defined by the statute. The court applied the statute functionally: because Alpine's distributors functioned the same as the state's definition of a direct sales force, it did not matter what Alpine labeled them. Further, the Court held that the state statute and administrative rules allowing the Comptroller to promote efficiency based rules for collecting and remitting sales taxes were proper and within the scope of the state and federal constitutions. Alpine was required to collect sales taxes on units sold within the state.
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