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  (Source: Stuart Isett/The New York Times )
Amazon says these sales taxes are "unconstitutional and counterproductive"

Amazon has fully committed itself to its effort against the collection of sales taxes, and it continues to prove this dedication over and over as it cuts ties with state after state.

After cutting ties with states like Texas, where Texas State Comptroller Susan Combs charged Amazon $269 million in unpaid sales taxes, and Illinois, where Sen. Dick Durbin (D-Ill.) plans to introduce a bill that would force Amazon to collect sales tax called the Main Street Fairness Act, Amazon is now looking to turn its back on California as well after Governor Jerry Brown signed a bill that would enforce the collection of online sales tax. 

"We oppose this bill because it is unconstitutional and counterproductive," said Amazon in an e-mail to Californian affiliates. "It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors. As a result, we will terminate contracts with all California residents that are participants in the Amazon Associates Program as of the date (if any) that the California law becomes effective."

Amazon also noted that these sales taxes "spur job and income losses." But Amazon has to do what it feels it should do, and with this bill in place, Amazon won't think twice about cutting ties with its 10,000 California-based sales affiliates.

Amazon is the largest online retailer with more than 90 million registered buyers and $34 billion in annual sales. In recent times, it has encountered increased pressure from certain U.S. states to collect online sales taxes since the retailer's affiliates operate within those states. In addition, some U.S. states see an online sales tax on Amazon purchases as a way of digging themselves out of large state budget deficits. 

But Amazon refuses to back down. Last month, Amazon CEO Jeff Bezos said the U.S. states' demands were unconstitutional, citing 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 its borders. 

As of right now, Amazon collects taxes in Kansas, Kentucky, New York, North Dakota and Washington. In other U.S. states where Amazon does not collect sales taxes, customers are to document and pay tax on out-of-state untaxed sales, but rarely do because they either don't know about this or just don't care.

Brick-and-mortar stores like Best Buy and Wal-Mart retaliated saying that Amazon has an unfair advantage due to its lack of sales tax collection in other states.

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RE: High and Mighty Wal-Mart
By abhaxus on 6/30/2011 3:59:26 PM , Rating: 2
Not that I don't agree with much of what you said, but here is an example for how local business drive more money (as a percent of their revenue) into the local economy than a company like Best Buy or Walmart. I work for a locally owned top 100 electronics retailer.

When a customer spends money at our store, money is paid to the employees at that store that sold the merchandise. The transactions are audited by people in our office (which is local), the employees' paperwork is handled by HR people in our office (which is local), the money is deposited into banks (which for our case, is a locally owned bank. I'm sure other local retailers bank with large national banks). Money is invested in new stores, which are built and remodeled by local contractors (most national chains have companies that move from town to town to build their stores). At the end of the day, ALL of the money stays local. The office people are all in my local area, instead of in a district office somewhere. The banks pay their employees with money made on our money. The contractors obviously do the same. There are of course many more examples if you dig deeper into our relationship with the local economy. In the case of Walmart or Best Buy, significant amounts of revenue do NOT stay local. Portions go to Arkansas and Minnesota. They go to shareholders. They do not stay in the local economy.

Now that said, I think you are right in many regards. But I wanted to show you an example of how buying local is indeed better than buying from large chains. In the same sense that it holds true that most people would be better served to spend more time researching their votes for local politicians than national ones.

RE: High and Mighty Wal-Mart
By lightfoot on 6/30/11, Rating: 0
"We don't know how to make a $500 computer that's not a piece of junk." -- Apple CEO Steve Jobs

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