Amazon Gets $269M Bill for Uncollected Texas Sales Tax
Amazon's third quarter financial results came with an unexpected twist. According to the retailer's SEC filings, the state of Texas handed Amazon a bill for $269 million for uncollected state sales tax. Amazon has said that the assessment of taxes is "without merit" and they plan to pursue the matter legally.
This isn't the first time Amazon has been at odds with state regulators. Businesses have traditionally only had to pay taxes in states where they have facilities or employees. Some states have tried to use Amazon's affiliate program as an excuse to levy taxes. Both North Carolina and Rhode Island went that route, so Amazon ended the affiliate programs there.
As state budgets continue to tighten, more legislatures may look to the wildly successful online retailer as a source of cash. Do you think Amazon and other sites should have to pay (and presumably charge you) state sales tax in all states?

Comments
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davzway
November 12, 2010 at 12:16pm
FEDERAL government should live by and enforce only as allowed by the US Constitution. The FED has been abusing it's authority for many years, and the internet tax issue is just another facet of the Monster the FED has become. IF a company does not have a physical presence in a State, they should NOT be forced to collect, nor should the State collect sales tax for that company. State's wanting more TAXES, encourage business's to have facilities in their state. Illegal taxing should never be allowed. davzway
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yr
October 23, 2010 at 5:53pm
Isn't it amazing that the government has nothing better to do than spend money on legal fees for a case that has already been lost in several other states?! If the government would just try to stop flushing OUR money down the toilet (or shoving it into their back pockets) they could probably cut sales tax in HALF for the brick and mortar stores too!
Proof that the government can manage its finances... I'll let you know if I ever find some.
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tri8gman
October 26, 2010 at 2:51pm
I'm sure that you realize that the state governments are separate from the federal government, though related to a degree. When people say "the" government, they're talking fed. If you're making a generalization about governments, you didn't go about it very well.
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Hydian
October 23, 2010 at 11:36am
@jlh304
As a business, you are responsible to collect sales tax for the consumers in a state that you have a physical presence in, not in all 50 states. States don't have jurisdiction to levy a sales tax on sales conducted outside of their boundaries. They can get around this by levying a "use tax" or something similar, but the businesses can't be held responsible for collecting it.
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jlh304
October 23, 2010 at 7:02am
I don't know where you get your facts from. As a business owner I'm responsible to pay sales tax not the consumer. I have to fill out paper work, and get audits to make sure it gets done. if someone didn't pay the state comes after me not the consumer. it is the business's duty, propable because people wouldn't claim half of what they bought.
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Shrody
October 22, 2010 at 8:29pm
The 2010 compounded Military budget for the U.S.A. is around 620 Billion dollars. How about they quit shooting at reporters and civilians and cut us (the people paying for this sh!t) some slack. And while they are at it, why don't they stop taking 40% of my yearly income. Or is keeping my hard earned money too much to ask?
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schwit
October 22, 2010 at 7:38pm
I buy stuff at Amazon, NewEgg and Ebay not so much because of availability, but because brick and mortar stores are not competitive.
Simple things like cables that are $3 on ebay are $20 at Staples or BestBuy. Having to pay taxes won't change that.
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harbingercmt
October 22, 2010 at 7:27pm
What Texas is trying to do has already been declared a violation of the United States Constitution. If you would like to know why, just do a search for Quill v. North Dakota (there are other similar rulings, but this one is fairly recent) or read the Commerce Clause section to the U.S. Constituion.
I would try to explain it to you all, but I find people will more readily accept the truth if you let them discover it themselves...so swish back that red pill and see what you discover.
Best.
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tri8gman
October 26, 2010 at 2:55pm
Honestly, do people really not know the difference between the state and federal governments and what they do?
Wars are the concern of the federal.
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Danthrax66
October 22, 2010 at 3:13pm
It doesn't matter the burden of paying sales tax falls on the consumer. If you buy something online you are supposed to report that and pay it to your state; most stores do this for you so you don;t have to worry about. But if you order something online you as an individual have to pay the sales tax of course no one checks this but that is the law.
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I Jedi
October 22, 2010 at 3:47pm
I understand what it is that you are saying, but who is honestly going to rat themselves out for having not paid taxes on merchandise?
"Oh, yes, please, government, take more of my money away, so you can spend it on important things, like expensive dinners, pricey hotels for congressmen, and a whole slew of other wasteful spending!"
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tri8gman
October 26, 2010 at 2:56pm
"Nevermind that when I don't give you money, both important things and bloat lose money, not just the bloat!"
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Biceps
October 22, 2010 at 3:03pm
Not paying sales tax equates to a 7-10% discount, depending on the state (with the exception of Oregon, etc). The age-old argument that charging state sales tax would damage online retailers no longer holds as much water... these retailers by and large now operate in a mature industry where best practices have been established.
Taxes suck, but it is unfair to burden brick and mortar store owners with them and exclude online retailers from the same burden.
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routine
October 22, 2010 at 10:32pm
You're abosolutely right!
We should stop taxing the brick and morter stores too.
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binkievanes
October 22, 2010 at 2:31pm
I am a longterm customer and order a lot from electronics to kitchen stuff to tools , garden equipment and evrything in between, all for the convenience of shopping from home and good pricing. It would be fair to add salestax to be honest, would i like it : not at all. Would I continue to order: yes. The convenience and the extreme good customer service weighs more to me
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JohnP
October 22, 2010 at 5:15pm
I agree 100%. I buy a ton of stuff from Amazon, and two key things keep me going back to them, no sales tax and free shipping (over $25). That makes Amazon my goto place for damn near everything. Now if one of those went away, I am still OK.
I love online shopping!
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