SALT Report 1972 – In a joint press release, Massachusetts Governor Deval Patrick and Amazon announced that the online retailer will begin to collect and remit sales tax in Massachusetts beginning November 1, 2013. The deal is similar to those that Amazon has worked out in other states, in which Amazon agrees to open warehouses in areas where tax disputes had previously prevented them from establishing a presence. In return, Massachusetts will benefit from the creation of hundreds of high tech jobs over the next few years as well as an increase in sales tax revenues.
The arrangement with Amazon was reached as Massachusetts reported weaker than expected tax revenue, with the October collections coming in $162 million lower than previous estimates and $48 million lower than the amount collected in October 2011.
In addition to the agreement, the Governor said that the state and Amazon will work together to push for federal legislation that creates a simplified and fair process for collecting sales taxes. Paul Misener, Amazon’s vice president of global public policy said, “We appreciate Governor Patrick’s commitment to Massachusetts jobs and investment and his support for legislation now before Congress that would provide a final resolution to the sales tax issue. We look forward to…continuing to work with Governor Patrick, state leaders, retailers, and Congress to pass federal legislation permitting interstate sales tax collection. Federal legislation is the only way to level the playing field for all sellers, the only way for states to obtain more than a fraction of the sales tax revenue that is already owed, and the only way to fully protect states’ rights.”
Amazon currently collects sales tax in a number of states, including New York, California and Texas, and has agreed to start imposing taxes in several states over the next few years.
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