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Poll: 'Amazon Sales Tax' Begins Saturday; Should We Have to Pay?

The online retailer will levy state tax on mail-order purchases beginning Sept. 15. Depending on where you live, that could add more than seven percent to the cost of each purchase.

If you've got items sitting in your Amazon shopping cart that you've not yet purchased, you might want to consider moving into the checkout line.

On Sept. 15, Amazon will begin charging sales tax on purchases for California residents.

Until now, buying online at Amazon.com could save customers money because no sales tax was collected. (Customers were expected to pony up those fees when they paid their taxes.)

But state lawmakers in California—a state that desperately needs cash—reached an agreement last year with online retailers, including Amazon, who agreed to begin collecting a sales tax in September. Those sales tax funds will be returned to the state.

According to the LA Times, about half of the projected $316 million raised in the first full year—and put into state coffers—is expected to come from merchandise sold by Amazon.

The agreement between Amazon and California may not last long. The Orange County Register reports that the agreement between the two parties was primarily a compromise meant to get a year's reprieve in collecting the tax in exchange for promises to add jobs and distribution centers in California.

Increased prices for online purchases is welcome relief for brick-and-mortar stores, who feel the playing field for customers will be a bit more level.

CNNMoney says Amazon already charges sales tax in six states: Kansas, Kentucky, New York, North Dakota, Texas and Washington. Pennsylvania will join California in sales tax charges in September. New Jersey, Virginia, Indiana, Nevada, Tennessee and South Carolina are all expected to collect state sales taxes from online retailers within the next few years, adding millions to state accounts.

States estimate they lose $23 billion in annual sales taxes, some $11.5 billion of it from online purchases, according to the National Conference of State Legislatures.

Meanwhile, Seattle-based Amazon has been expanding its physical presence in California, according to the SF Chronicle. The Chronicle says that, in June, it leased 83,000 square feet just south of San Francisco's Financial District.

And in Sunnyvale, according to the Chronicle, "Amazon is reportedly close to signing up for close to 600,000 square feet at the partially completed Moffett Towers complex to house its Lab 126 subsidiary, currently in Cupertino. The lab is where the Kindle and other 'easy-to-use, highly integrated consumer products' (including an Amazon smartphone) are being developed."

Amazon is also expected to open two California fulfillment centers that will employ at least 1,000 workers each in San Bernardino and Patterson.

If you're interested in applying for those jobs, Amazon has set up a website to receive applications.

Joy Kekki September 15, 2012 at 01:02 AM
I agree with Edward, to some extent. I think the state does not need more money; it needs a better budget and an outside auditor to control frivolous spending. (I am so going to be beaten up for that.) Since business owners take advantage of tax write-offs and loopholes, it does not seem unreasonable for the average consumer to want an occasional break as well. That Amazon's sales will drop is the only result I can foresee from its taxation. Okay, let me have it.
Kirsten Schwartz September 15, 2012 at 03:28 AM
Amazon's headquarters are in Seattle, so their sales are from Seattle. So they don't have to pay CA sales tax. Okay, let the corrections to this fly in.
Edward Hicks September 15, 2012 at 03:56 AM
No, you're spot on, Joy. The last thing that the "government" needs is more money. What about better stewardship? When using Amazon where does the economic transaction actually take place? These added expenses will simply be passed to the consumer.
Erika Lockhart September 15, 2012 at 05:42 PM
If you haven't been paying the required tax, shame on you. I pay mine every year. Probably a boon for them to start collecting it because it will reduce the nightmare it is for me every year to figure out how much I've spent in on-line purchases for items for which tax was not collected. For anyone planning to vote for a person who wants to "soak the rich" for tax revenue, think about it if you have not paid required taxes. Most local taxes are directed at local services. I think mail-order should collect a lower amount since they rely less on local services. They will also be paying local taxes where they are based. We are paying almost 10% sales tax, and that is on top of income taxes. Would that the Constitution prohibited double taxation at the same time it prohibited double jeopardy!
Erika Lockhart September 15, 2012 at 05:51 PM
Want a biscuit? Huh? Fair share? Expecting the rich to pay taxes NOT BEING PAID BY PEOPLE WHO OWE? Change the laws, then, but don't excuse people who don't observe existing laws. If you actually pay what you owe, you have some skin in the game.

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