Governor: Amazon Should Start Collecting State Sales Tax

The Internet giant has been exempt from collecting sales taxes in Massachusetts but some say that changed when it bought a North Reading company this year.


The Patrick Administration is arguing that after Amazon, the huge online retailer, bought a Massachusetts company this year it is no longer exempt from collecting the state's 6.25 percent sales tax as soon as the 2013 holiday season.

Under federal law, online retailers are not required to collect state sales taxes if they do not have a physical presence in the state, such as an office building or a store, the Boston Globe reported

But Amazon bought North Reading company Kiva Systems this year, and is recruiting engineers for a Cambridge office, according to the Globe report. This, Patrick says, means it needs to start collecting the state sales tax in Massachusetts. 

Amazon has faced similar pressure from other states and collects sales taxes in eight of them, according to the report. States and local retailers have also pressed the federal government to compel Amazon to pay state sales taxes. 

“This is not simply a revenue issue . . . it is a matter of fairness and equity to Main Street businesses,” state Treasurer Steve Grossman wrote in a letter to the chairman of the federal Senate Committee on Finance, urging him to change online taxation laws. 

Indeed, Massachusetts retailers have been fighting this battle for years, arguing that Amazon has an unfair advantage since it doesn't have to collect the tax. The Massachusetts Main Street Fairness Coalition says the state ultimately ends up losing out, too. According to its numbers, the state government lost $387 million in 2011 from residents buying sales-tax-free items online, the Globe reported

MoonBeamWatcher November 21, 2012 at 05:06 PM
Anything sold in MA should have the SALES TAX collected and sent to the State Tax Collector. Why, do 'just some states' require this and not others?
MoonBeamWatcher November 21, 2012 at 05:43 PM
Not providing jobs with benefits to MA residents. Not providing a BRICK and MORTAR facility in state then FURTHER advantaged by not having to collect or for the consumer NOT TO HAVE TO PAY MA SALES TAX certainly puts Brick and Mortar at a serious dissadvantage!
Patricia November 22, 2012 at 04:12 AM
That's all we need - more taxes. Leave internet commerce alone.
MoonBeamWatcher November 22, 2012 at 05:18 AM
Have you NO SHAME Patricia? How many times have you gone into a REAL store then bought your item you researched for 15% less on line sans sales tax which effectively covered the shipping? Real stores hire your neighbors and provide benefits! These REAL stores also provide FREE customer service and advice!
Patricia November 22, 2012 at 04:14 PM
No shame at all. I don't have a huge income, I want books and dvds at the lowest prices I can find; Amazon has most of them and is a reliable merchant. I don't go into real stores to research the items' prices, either; since I'm fairly knowledgeable about the prices; and since I rarely buy best-sellers, Amazon gives me the best value. I have also shopped in Brookline; several times a year, including the Booksmith, a store I appreciate very much. But for me, having access to Amazon's tax-free low prices means I can usually buy more books and dvds than if I purchased them at "real" book stores, especially if I tried finding them in Brookline.
MoonBeamWatcher November 23, 2012 at 03:39 AM
Some people just can't be shamed. Review the book at "Booksmith" then buy sans SALES TAX on Amazon, I rest my case!


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