Amazon starts collecting state sales tax across US next month

Adam Westlake - Mar 25, 2017
20
Amazon starts collecting state sales tax across US next month

As an e-commerce giant, one of Amazon‘s biggest advantages for customers (and biggest disadvantages for brick-and-mortar competitors) has been the site’s lack of charging local sales taxes. This has been slowly changing over the last few years, and the policy will finally come to an end next month. Starting April 1st, Amazon will collect a sales tax in all 45 states that have one, with Hawaii, Idaho, Maine, and New Mexico being the last four to be included.

This means that any Amazon customers placing orders in those states will see their local sales tax applied when they checkout, just as if they were making a purchase locally at a retail store. The five remaining states that won’t see a sales tax on their orders are Alaska, Delaware, Montana, New Hampshire, and Oregon, but that’s because they don’t impose a sales tax in the first place.

Amazon first started losing the sales tax war several years ago when it began opening warehouses and fulfillment centers in locations across the country, as simply physically operating within certain states meant they were required to collect on local orders.

Another 10 states were added to the sales tax list at the start of this month, so in just over a week Amazon will finally be equal in that regard with physical retailers across the country. While this change will mean closer pricing between Amazon and rivals on a wide range of items, it will still be difficult to top the convenience of ordering online combined with a number of fast shipping options.

SOURCE: CNBC


Must Read Bits & Bytes