Print 10 comment(s) - last by FrankBlank.. on Jun 6 at 9:14 PM

These two new facilities will add up to $130 million in capital investment, and will create over 1,500 full-time jobs for New Jersey residents

Amazon has agreed to collect sales tax on purchases made by New Jersey customers starting July 1, 2013, or whenever federal legislation is passed.

New Jersey Governor Chris Christie made two Amazon-related announcements today, one of which included the collection of sales taxes beginning next summer.

This is a huge step for Amazon, considering the e-tailer fought many states that attempted to press tax collection on Amazon purchases. For instance, Amazon said it was closing one of its distribution centers and canceling operation expansions in the state of Texas last year because of a tax dispute with Texas Comptroller Susan Combs. According to Combs, Amazon was responsible for $269 million in uncollected sales taxes on online purchases.

Amazon fled many other states that attempted to force tax collection on the company as well, such as California and Illinois. Amazon has said that it does not have to collect sales tax because of a 1992 Supreme Court decision that excuses Amazon and other remote sellers from having to collect taxes in U.S. states that do not have the company's employees or warehouses operating within those states. But between states looking for ways to offset large financial deficits and brick-and-mortar stores like Best Buy complaining about Amazon being unfair competition, Amazon is being pushed between a rock and a hard place.

However, Amazon CEO Jeff Bezos did say that his company would agree to collect taxes if there were some sort of federal legislation. This has not occurred yet, but Amazon continues to push for it while slowly agreeing to tax collection in certain states. Just last month, Amazon finally agreed to collect sales tax in Texas starting July 1, 2012. Amazon also agreed to start collecting sales tax on online items in California starting next year, and in Arizona in 2014.

Gov. Christie's second announcement was the construction of two Amazon distribution centers within the state of New Jersey. These two new facilities will add up to $130 million in capital investment, and will create over 1,500 full-time jobs for New Jersey residents.

"In yet another positive sign in our state's economic and job growth, I'm pleased Amazon is committed to helping New Jersey grow and create quality jobs," said Christie. "After months of hard work and collaboration, Amazon has joined the long list of companies that recognize New Jersey's economic and business climate is improving. We've created an atmosphere of job creation, growth and investment, which is why we've taken another important step toward placing quality, good-paying job opportunities within reach of our families."

Source: New Jersey

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Not stupid
By Dorkyman on 5/31/2012 4:35:34 PM , Rating: 2
Since Amazon is not stupid, I think there could be two factors at work here.

First, Amazon is going to build large distribution centers in New Jersey. Perhaps Amazon got an incredibly sweet tax deal from the state that would more than offset any loss of business due to additional sales taxes on purchases.

Or perhaps Amazon wants to pull up the rope ladder now that they are inside the treehouse. This is a common trick by the largest companies in a particular market--make life harder for the little companies nipping at their heels now that they (the big company) don't suffer as much due to economies of scale.

RE: Not stupid
By idiot77 on 5/31/12, Rating: 0
RE: Not stupid
By spamreader1 on 6/1/2012 9:45:38 AM , Rating: 2
lol, new jersey and well educated mentioned together.

RE: Not stupid
By theapparition on 6/1/2012 10:35:38 AM , Rating: 3
New Jersey has some of the highest test scores in the nation (top 3), along with the highest rate of advanced placement students. They lead the nation in many education studies.

Not a fan of NJ, but give them credit where due.

RE: Not stupid
By mindless1 on 6/2/2012 8:10:23 PM , Rating: 2
This is laughable because it's being suggested that these well educated students would opt to stay in NJ and work in an Amazon Warehouse.

YES, that's exactly the American Dream, pay thousands and spend years on your education so some day you can work in a warehouse. Or not. The more intelligent the labor pool in any given area, the higher the turnover rate at undesirable jobs like this. That's a negative not positive thing for Amazon.

RE: Not stupid
By theapparition on 6/6/2012 3:49:52 PM , Rating: 2
The more intelligent the labor pool in any given area, the higher the turnover rate at undesirable jobs like this.

Patently false. Unskilled/uneducated labor has the highest turnover rate, bar none.

I don't think it was ever suggested that university graduates were going to give up careers to work at the Amazon warehouse. My original comment was that NJ graduates some of the most educated people from HS (at least from standards based testing scores). It was not suggested that everyone is a valedictorian nor they all go to college.

Having more job options in a local economy is never a bad thing.

RE: Not stupid
By mindless1 on 6/6/2012 7:04:53 PM , Rating: 2
LOL, the details seem to have flown right over your head. That's what these are, unskilled warehouse jobs, which in an area where the average education level is higher, will mean these unskilled jobs have the highest turnover rate of all.

You are arguing on favor of NJ students instead of staying on topic about the suitability of the environment for Amazon. Students having more job options is bad for Amazon in that they will have higher turnover rate as people leave the warehouse job for something better.

RE: Not stupid
By theapparition on 6/1/2012 10:37:18 AM , Rating: 2
Not only that, but I think Amazon would have been a lot more amenable towards some sales taxes if they were given a fair chance.

In Texas, they weren't given the opportunity to start collecting by a certain date. Instead, it was like, you've been doing business here for the last 5 years and owe us close to 300million. Now pay up.

RE: Not stupid
By WalksTheWalk on 6/1/2012 3:26:15 PM , Rating: 2
Amazon has been playing this "catch me if you can" game for a while. The Government is realizing that billions of dollars are being spent online whereas, back in the day, mail order was a relatively small affair.

Ultimately the Government will get their pound of flesh.

Amazon in Jersey
By FrankBlank on 6/6/2012 9:14:36 PM , Rating: 2
My guess is the distrib centers will give easy access to NY for a lower tax rate than NY's, and as someone mentioned, a sweetheart deal from Jersey.

Which state, BTW, is quite beautiful in many places. It ain't all like the industrial and refinery areas around NYC.

"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins

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