APNewsBreak: Sprint-Nextel sued for NY taxes

ALBANY, N.Y. (AP) -- New York Attorney General Eric Schneiderman (SHNEYE'-dur-muhn) is suing Sprint-Nextel Corp., claiming it under-collected and underpaid $100 million in sales taxes to keep prices down.

The lawsuit is the first filed under a state law allowing the government to sue over tax losses from fraud. It could require the company to pay triple the amount it is accused of underpaying.

Schneiderman says Sprint since 2005 underpaid the tax and submitted false records.

Since 2002, New York tax law has required mobile phone companies to collect and pay sales taxes on the full amount of their monthly access fees for calling plans. Schneiderman says competitors Verizon, AT&T, T-Mobile, and MetroPCS pay the tax.

Sprint says the complaint is "without merit" and it paid all taxes it believes its customers owe.