Tags: amazon | third party | sellers | states | sales tax

WSJ: States Hungry for Sales Tax Eye Amazon's 3rd-Party Sellers

WSJ: States Hungry for Sales Tax Eye Amazon's 3rd-Party Sellers
(AP/Paul Sakuma)

By    |   Thursday, 30 March 2017 12:14 PM

Cash-starved U.S. states reportedly think they’ve identified a “prime” target to help fill their quickly depleted coffers.

States may start taxing the individuals and small companies that account for a growing share of Amazon.com Inc.’s online marketplace’s sales, The Wall Street Journal reported.

 At least eight states are considering new measures this year that aim to force marketplaces such as Amazon and eBay Inc. to collect sales taxes on behalf of those selling merchandise on their sites or to force sellers to report sales, according to the National Association of State Budget Officers.

“Third-party sellers, which now account for more than half of Amazon’s sales, often are small businesses that say they aren’t able to easily track where their goods are held and sold, and don’t necessarily know what might trigger the need to collect and pay sales tax in states outside where they are based,” the Journal reported.

“Under current federal law, retailers are required to collect sales taxes only in states where they have a physical presence. That means that if a seller is based in New York and only has operations in that state, they would collect sales taxes only from New York customers,” the Journal explained.

State sales-tax revenues grew at a weak rate of just 1.7% in the fourth quarter, the Journal quoted the State University of New York’s Nelson A. Rockefeller Institute of Government as reporting.

Meanwhile, a lesser known phenomenon is that while Amazon can be a fierce competitor, it also procures services and supplies from mom-and-pop merchants, even those it might consider as rivals.

"Our fulfillment centers across the U.S. are encouraged to work with local businesses to support the site’s needs whether that’s connecting with local restaurants and catering companies to provide employee appreciation meals to purchasing supplies from local vendors," Amazon spokeswoman Kelly Cheeseman told Bloomberg.

"Whether it’s through the creation of jobs, purchasing from local suppliers or local giving, we’re proud to support the communities where employees live and work."

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Cash-starved U.S. states reportedly think they've identified a "prime" target to help fill their quickly depleted coffers.
amazon, third party, sellers, states, sales tax
342
2017-14-30
Thursday, 30 March 2017 12:14 PM
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