Texas sends $269 million bill to Amazon.com for uncollected sales taxes

DallasMorningNews.com ^ | 10/23/2010 | Maria Hakkias

[devane617]

Texas has sent Amazon .com Inc. a $269 million bill for uncollected sales taxes on purchases made by state residents from the Seattle-based Internet superstore over a four-year period.

Now that Texas has gotten tough with the No. 1 online retailer, other states could be tempted to pile on with their own assessments as local governments face huge shortfalls, analysts said. Recent estimates put Texas' two-year budget shortfall at as much as $21 billion.

[devane617]

Interesting.

[Krankor]

I buy TV’s, books and shoes online. Not paying taxes is the major lure.

[Zuben Elgenubi]

Well, if Amazon is collecting sales taxes, what ARE they doing with that revenue? Not paying a dividend that’s for sure. They just announced yesterday they’ll begin paying a dividend.

[El Cid]

Well that will be great for the economy and businesses...
Shareholders seeing the Companies which they own shares, getting decimated by government leaches...

Just great. That'll show 'em.

[born2bfree]

That’s just it, they are not collecting sales tax. At least not in my state. It is one of the reasons I shop with them.

[No Socialist]

I buy everything from books and dvd’s to Clothing, shoes, gifts, and food items from Amazon. No taxes, I get everything in 2 days. I love Amazon. Hope states leave them alone.

[KarlInOhio]

So a "subsidiary" with the same address as Amazon's main office is operating a distribution center in Texas. Amazon is walking on some pretty thin ice here trying to claim that the subsidiary's Texas location doesn't create a taxable nexus for Amazon.

[SatinDoll]

I would be interested in reading what others have to say about States receiving sales taxes from an out of state retailer.

I live in the State of Washington.

I pay sales taxes to Amazon as they are located in that state.

I pay sales taxes to Ebay vendors who are located in Washington state.

Why should Washington state collect any sales taxes from me IF I purchase anything out of state?

If Texas is successful in this lawsuit, does that mean I could expect in the future to carry the responsibility of accruing sales taxes on out of state purchases and paying them all when I return home?

Texas is opening a can of whoop-a$$ with this lawsuit!!

[stubernx98]

BTW, Murry who works for the people(not) did not bother to get the WA sales tax deduction from Fed taxes!

[TigersEye]

I guess they can move to another country and coordinate their business from there.

[AlexW]

“I would be interested in reading what others have to say about States receiving sales taxes from an out of state retailer.”

How does a state know what is being sold online, from one party to another?

[ctdonath2]

“Subsidiary” in this case is a very fuzzy term. It amounts to little more than consignment.

[Past Your Eyes]

More than interesting, it’s ridiculous. To hell with Texas and their sales tax.

[ctdonath2]

States sending police to collect license plates of residents shopping in other states is not unheard of.

[Publius6961]

First time I've found something negative about Texas.
Unless Amazon has a warehouse or other physical facility in Texas, I don't see any legal justifcation for it.

I hope Amazon fights--- and wins.

Too many industries are quick to cave, calculating correctly that they can just pass on the added costs to their customers and if their profit is a fixed percentage, they can enjoy the windfall.

But it's government's fault.

[AndrewB]

Why should Washington state collect any sales taxes from me IF I purchase anything out of state?

Legally, you do owe the tax and are expected to report the purchase and pay the state use tax yourself.(yeah right..)

Out of state merchants are not required to collect the tax at the time of the sale...(yet).

[SatinDoll]

Fat chance collecting it.

[ken21]

it would drastically reduce sales,

in effect, destroying internet sales.

[AndrewB]

Exactly, and that loophole has been in large part responsible for the explosion in online retailing. Expect a unified internet sales tax sometime soon; state governments are hungry.

[pnh102]

I love Texas and all but what authority do they have to collect sales tax on purchases made from an out of state company with (I am guessing) no business presence in Texas?