Mastercard Urges South Carolina Court to Overturn Income Tax Ruling

Mastercard International Inc. wants the South Carolina Court of Appeals to free it from a $6 million corporate income tax bill that was based on the notion that the company’s income-producing activity is facilitating transactions between merchants and customers in the state.

The South Carolina Administrative Law Court’s June decision violates the “straightforward rule” established by the appeals court in a case involving DirecTV that a service provider’s income-producing activity is delivery to the paying customer, the company said in its Wednesday opening brief.

Mastercard’s paying customers aren’t the South Carolina cardholder and merchant, but their banks, which are ...