Amazon is a Lovely Company, But Its Tax Position is Indefensible

AmazonĀ is a lovely company, but its California retail sales tax position isĀ indefensible.

Amazon said Monday that it would back a California ballot initiative that would roll back a new state law that forces more online retailers to collect sales tax.

via Amazon Backs End to Online Sales Tax in California – NYTimes.com.

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Comments

  1. Danny L says:

    I would love to see an analysis of how much of Amazon's valuation is based on the assumption that they will continue to enjoy a preferential tax rate (through non-enforcement).

    Combining that with what looks like permanently higher transportation costs, and it's hard for me to understand how a business model that relies on sending products by second-day air can survive.

    But I love to shop on Amazon, so I hope I'm wrong.

  2. @enoss says:

    It is only indefensible as a local solution meaning when compared to other California retailers. What it really highlights is that the existing demarcation lines for tax policy do not work when applied to the Internet and need to be rethought, but that would require too much foresight on the part of governments.

    Amazon is doing the right thing for Amazon which, sadly, is what all tax policy is about. California loses by resisting.

  3. A Country Farmer says:

    Literally indefensible? There are no questions of morality, philosophy, etc.? A strong claim.

  4. The world is flat now. So, taxes need to be paid to the municipality where the purchaser is located – or go to a VAT system – or any number of other options. But sales tax (not talking income/state in this case [not talking income tax here]) – sales tax needs to be reworked. The world is too flat and there is equal access to purchasing goods in any one location from any other location. The hard part is not fixing it. The hard part is getting people to willingly accept that the only way to fix it is a federal solution which means strengthening the interstate commerce act by default. I'm not saying the solution is strengthening the "government" per se, but that it has to be an umbrella system in order to be fair. That would mean the interstate commerce acts are strengthened and the real problem is one of social acceptance of that idea (i.e.: states rights and all that goes with the conversation.) The problem isn't a lack of a solution, it's the impossibility of selling it to a paranoid public. And so the problem will not be fixed, only skewed more in one direction or another, adding more power and cash to the corporate side. Such is life.