New Taxes Await Online Holiday Shoppers

Ravenous state tax collectors are extending their reach into what was previously an online refuge


SAN FRANCISCO — Some shoppers are in for a rude awakening as they click to check out with holiday purchases on Black Friday — they'll have to pay the tax man.

For the first time since the dawn of e-commerce, residents in California, Texas and Pennsylvania will be automatically charged state sales tax at the checkout on Amazon and some other online retail websites. Next year, Virginia and New Jersey residents will join them, followed by residents of Nevada, Indiana and Tennessee in January 2014.


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  1. And naturally, another black market will develop.

    Got a trustworthy friend that resides in a state not on the list? Have them buy your bigger ticket items.

    1. Then you either ship it twice or someone makes a round trip to pick it up or deliver.

    2. Tech retailer Provantage already gives you this option for some states where they have distribution centers. They will ship internally to their headquarters then ship to you from headquarters to avoid sales tax if you choose.

  2. They already charge NH sales tax.


    But Amazon will continue to not collect taxes on hundreds of thousands of items that it lists for sale on its Web site, stores in its warehouses, and packages for quick shipment to California residents.

    Those orders — called “fulfilled” by Amazon — amount to a tax loophole that has left Sacramento tax collectors a tad unhappy. California sales tax rates are among the highest in the country, topping out at 9.75 percent, meaning the apparent tax savings can add up quickly.

    A representative of the State Board of Equalization, which collects California sales taxes, told CNET today that whether Amazon can be required to collect taxes on “fulfilled” orders is a tricky question. “It’s difficult for us to comment on the way Amazon is set up within its family of companies (and) whether there there would be a consignment relation,” the representative said.

    Amazon says the law is clearly on its side. Spokesman Scott Stanzel said that for fulfillment sales, “sales tax collection depends on the tax obligations of the seller,” not Amazon itself.


    “You can assume we’ll have ways of finding out who’s holding stocks of goods in California,” a representative of the State Board of Equalization, which collects California sales taxes, told CNET. “We have enforcement authority to obtain information in a variety of ways. We’ll be approaching them with respect to their tax obligations.”

    Translation: We can demand that the New York camera shop cough up sales taxes — which in the Golden State top out at 9.75 percent — even if Amazon never collected them at checkout on behalf of the camera store in the first place.

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