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Amazon and sales tax
Thu September 1, 2011
California rebuffs deal with Amazon amid tax dispute
Seattle-based Amazon is under ongoing pressure from the state of California to collect state sales taxes from internet consumers. This week the retailer offered a deal to California's legislature and retailers to try and curry favor. But Amazon was rebuffed.
The Golden State passed legislation that went into effect in July to force Amazon and other online retailers to pay state sales tax.
This week Amazon tried to win over California politicians with a promise to build two California distribution centers and hire up to 7,000 workers. They hoped this would sway politicians to repeal the legislation. But no deal was made.
Bill Dombrowski is with the California Retailers Association. He says Amazon isn't currently in violation of California law.
"They do not have to have to turn over the sales tax revenue until the end of October," Dombrowski says. "So technically they're not in violation with the law until they fail to do that."
The California retailers are trying to collect $200 million a year in unpaid taxes from online sales.
Meanwhile, the Seattle-based company has collected signatures for a referendum in California that would repeal the tax legislation.
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