California Lawmakers Give Amazon Tax Reprieve

Gerald · 09-11-11, 01:39 PM

SAN FRANCISCO — California lawmakers overwhelmingly approved a compromise bill Friday night giving Amazon.com a one-year reprieve from having to collect a sales tax from its customers in the state.

Under the new measure, Amazon agreed to start collecting the tax in September 2012 unless there was federal legislation on the issue. Senator Richard J. Durbin, a Democrat from Illinois, has proposed a national law requiring e-commerce companies to collect sales tax, but it has not gained much traction.

Legislatures around the country, supported by struggling bricks-and-mortar stores, have been seizing on the sales tax issue as a means of raising much-needed funds. Amazon is fighting in the courts against a New York law compelling it to collect taxes, and has used the prospect of either opening or closing warehouses as a bargaining chip in negotiations with Texas and South Carolina.

The deal with California might embolden other states, said Robert W. Wood, a tax lawyer here. “Other states needing money will look and say, ‘It wasn’t a smooth process, but California is going to come out ahead,’ ” Mr. Wood said.

California lawmakers spent much of the summer trying to compel Amazon to collect the tax, but the Seattle-based retailer aggressively resisted, spending $5 million to gather a half-million signatures to take the matter to voters in a referendum next June.

The battle pitted Democrats and the California Retailers Association against Amazon and Republicans, who called attempts to collect the tax a tax increase. Consumers are supposed to pay a use tax on material they buy online, but few do.

http://www.nytimes.com/2011/09/11/te...ref=technology

Note: September 10, 2011

09-11-11, 01:39 PM	#1
Gerald SUBSIM Newsman Join Date: May 2008 Location: Close to sea Posts: 24,254 Downloads: 553 Uploads: 0	California Lawmakers Give Amazon Tax Reprieve SAN FRANCISCO — California lawmakers overwhelmingly approved a compromise bill Friday night giving Amazon.com a one-year reprieve from having to collect a sales tax from its customers in the state. Under the new measure, Amazon agreed to start collecting the tax in September 2012 unless there was federal legislation on the issue. Senator Richard J. Durbin, a Democrat from Illinois, has proposed a national law requiring e-commerce companies to collect sales tax, but it has not gained much traction. Legislatures around the country, supported by struggling bricks-and-mortar stores, have been seizing on the sales tax issue as a means of raising much-needed funds. Amazon is fighting in the courts against a New York law compelling it to collect taxes, and has used the prospect of either opening or closing warehouses as a bargaining chip in negotiations with Texas and South Carolina. The deal with California might embolden other states, said Robert W. Wood, a tax lawyer here. “Other states needing money will look and say, ‘It wasn’t a smooth process, but California is going to come out ahead,’ ” Mr. Wood said. California lawmakers spent much of the summer trying to compel Amazon to collect the tax, but the Seattle-based retailer aggressively resisted, spending $5 million to gather a half-million signatures to take the matter to voters in a referendum next June. The battle pitted Democrats and the California Retailers Association against Amazon and Republicans, who called attempts to collect the tax a tax increase. Consumers are supposed to pay a use tax on material they buy online, but few do. http://www.nytimes.com/2011/09/11/te...ref=technology Note: September 10, 2011 __________________ Nothing in life is to be feard,it is only to be understood. Marie Curie