Class Action Says Madewell Overcharged Missouri Online Shoppers for Sales Tax

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A proposed class action lawsuit alleges Madewell, Inc. has overcharged Missouri consumers for sales tax on online purchases shipped from out of state.

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The 10-page lawsuit against the retailer says that the state’s use tax rate is 4.225 percent for merchandise ordered online, through a catalog or by telephone and shipped to Missouri addresses from out-of-state facilities. Per the suit, however, Madewell has erroneously charged Missouri consumers taxes for these “remote” purchases at a rate well over the correct 4.225 percent.

As the case tells it, the plaintiff ordered a pair of ankle boots from Madewell.com in late October 2022 to be delivered to her Missouri home address from a facility in Virginia. The complaint relays that although state law declares that the use tax rate for this purchase is 4.225 percent, Madewell allegedly charged the plaintiff a rate of 7.476 percent.

According to the filing, the defendant has wrongfully overcharged Missouri shoppers like the plaintiff in violation of the state’s Merchandising Practices Act and received profits “which in equity and good conscience ought to be returned.”

The lawsuit looks to represent anyone who purchased a Madewell product for personal use through a remote sales channel, including Madewell.com, that was delivered from an out-of-state facility to a Missouri address.

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