B12 Solipsism

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Amazon and Texas Taxes

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Ready for a scotch

I guess Governor Quinn still hasn’t decided whether to sign the Illinois Amazon affiliate killing bill yet. Meanwhile, Amazon is in a fight with another state, namely Texas.

The planned closure of an Amazon.com Inc. distribution center in a suburb here has opened a debate about whether taxes or jobs is the better answer for Texas’ tattered budget.

The online retailing giant said last week that it would close its center in Irving due to a dispute with the state comptroller, who is demanding that Amazon pay $269 million in sales taxes it should have collected on goods sold to Texas residents.

The Supreme Court ruled in 1992 that businesses without a physical presence in a state are not obliged to collect taxes on the goods they sell there.

Since then, states have been trying to get Congress to change the law or have been seeking a way around it. A coalition of states has lobbied Congress to force online retailers to collect some taxes—so far without success. Some states, including Illinois and New York, broadened the definition of “physical presence” to include online retailers who pay commissions for referrals by local partners.

Illinois lawmakers recently passed a similar bill, which awaits the governor’s signature. Amazon has responded to the various laws with lawsuits or by cutting ties to the local businesses.

(click here to continue reading Amazon’s Exit Spurs Tax Fight in Texas – WSJ.com.)

Written by Seth Anderson

February 17th, 2011 at 8:58 am

Posted in Business,government

Tagged with ,

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