Amazon feels heat over sales tax controversy

Tennessee leaders caved when threatened to cancel its Tennessee expansion if state government tried to force the online retailer to collect sales taxes. But Amazon won’t be able to avoid collecting state sales taxes forever.

Pressure continues to build from a variety of sources, including potential federal legislation and a newspaper ad campaign funded by  Amazon competitors.

The newspaper ads target Amazon shareholders’ annual meeting being held today in Seattle. Also, Politico reported Monday that Sen. Dick Durbin (D-Ill.) may introduce a bill this week that would allow states to require out-of-state online retailers to collect state sales taxes.

Politico noted that a similar bill filed last year failed, but “the dynamics in Congress may have changed now that a growing number of states have passed or are considering bills to address the issue and online businesses are faced with the possibility of complying with many different state laws and many different state sales tax rates.”

Central to Durbin’s idea is the Streamlined Sales and Use Tax Agreement, a national effort launched in 2000 in response to a U.S. Supreme Court ruling that said a state cannot require e-retailers to collect sales tax if the seller does not have a physical presence in the state.

It will be interesting to see what Tennessee leaders do, if Durbin’s idea is approved by Congress.

Here’s the Politico story: Internet Tax Push Gains Currency 

More on Streamlines Sales and Use Tax Agreement

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