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April 26th, 2012, 11:49 AM #1Amazon, state working on sales tax collection deal
Latest on Texas:
Amazon.com is negotiating with Texas officials to resolve an outstanding bill for $269 million in uncollected sales taxes and to settle an ongoing dispute with the retailer over future online tax collections, the comptroller's office confirmed Tuesday.
Lauren Willis, spokeswoman for the state comptroller's office, said Amazon representatives have been in Austin for a week, talking with Comptroller Susan Combs.
"We are working on something with them," Willis said, but she declined to give more specific details.
Willis also declined to comment on whether the agreement with Amazon might be similar to a proposal the online retailer made during the Legislature's past session. Amazon had proposed bringing new facilities and thousands of jobs to Texas in exchange for an exemption on collecting taxes on sales to people in Texas.
Willis said Combs "is optimistic" about the progress of the current talks and said she anticipates an agreement could be announced this week.
No other state lawmakers or officials have joined Combs in the negotiations with Amazon, Willis said. An Amazon spokeswoman could not be reached for comment Tuesday.
At the end of last year's legislative session, Amazon offered to bring as many as 6,000 jobs to the state and to invest as much as $300 million over three years. In exchange, the online retailer sought a 4 1/2-year exemption from collecting sales taxes on online sales in Texas.
Paul Misener, Amazon's vice president of global public policy, sent legislators a letter at the time that read, "Amazon fulfillment and customer service affiliates intend to create these 6,000 new jobs somewhere in the U.S., and I respectfully request that you support the safe harbor provision that would allow these jobs to be created in Texas."
Lawmakers ultimately decided against accepting that deal, but Amazon has reached similar deals with other states, including California, South Carolina and Nevada.
State Rep. John Otto, R-Dayton, a key player in the debate during last year's legislative session, told the American-Statesman on Tuesday that while he "is not a party to the negotiations," he did speak with Combs this week and discussed the situation with her. Otto said his message to Combs was that Texas "should get a better deal than California did." California in 2011 agreed to a one-year sales tax collection moratorium for Amazon.
Amazon does not currently collect sales taxes in Texas and many other states. The comptroller's office in September 2010 moved to collect $269 million in uncollected sales taxes from the retailer for sales from 2005 to 2009. Amazon has been fighting the assessment in court.
Combs has said Amazon is required to collect sales taxes on Texas transactions because it has been operating a distribution center in Irving, and that constitutes a physical presence in the state. A 1992 U.S. Supreme Court decision said a company with a physical presence in a state can potentially be required to collect sales tax there, legal experts say.
Seattle-based Amazon, which had $34 billion in sales in 2010, has consistently opposed collecting taxes. That has drawn fire from state governments facing budget shortfalls and from traditional brick-and-mortar retailers, who say online sellers essentially give customers an automatic discount when they don't collect taxes.
Combs has estimated the state loses $600 million a year from untaxed online sales.
After it received the $269 million assessment, Amazon reacted by saying it would close the Irving facility, eliminating 119 jobs. Amazon also said it would scrap plans to expand in Texas, accusing the state of having "an unfavorable regulatory climate."
Gov. Rick Perry criticized Combs' action and said in February 2011 that he hoped legislators would try to keep Amazon from leaving Texas.
Instead, during the legislative session, the House and Senate passed a measure spelling out that retailers that have distribution centers or warehouses in the state must collect sales taxes.
Perry vetoed that measure, but language identical to that bill was attached to Senate Bill 1, the fiscal matters bill. On June 9, the House defeated an amendment by Rep. Bill Zedler, R-Arlington, to strip the language from SB 1.
On Tuesday, Otto said his preference for any Amazon deal would be for one in which Amazon begins paying sales taxes in a year or less. Such a deal would be good for Texas and for traditional merchants here, he said.
"All I want is for the playing field to be level," Otto said. "If the bricks-and-mortar folks have as their options, A) to have Amazon start collecting sales tax after a year, or B) to wait on the federal government for a solution, I think if you ask them, they'll think A is the better option."
Stephanie Gibson, vice president for government affairs with industry advocacy group the Texas Retailers Association, said the comptroller's office has told her organization that negotiations include potentially having Amazon begin collecting tax on Texas sales as early as August.
"From our membership's perspective ... we are thrilled to have Amazon finally step up to the plate and collect sales tax and create a fair playing field," Gibson said. "If they are going to be willing to create distribution centers and create jobs and come to the table like we have ... we're willing to negotiate."
Contact Barry Harrell at 912-2960
April 27th, 2012, 03:05 PM #2
- Join Date
- June 20th, 2011
Looks like Amazon is going to start collecting online sales tax in Texas beginning July 1.
Amazon.com and Texas Comptroller Susan Combs said Friday that the online retailer will begin to collect Texas sales taxes beginning July 1, in an agreement that Combs said “resolves all sales tax issues between Texas and Amazon.”
Amazon said it will create at least 2,500 jobs in Texas and make at least $200 million in capital investment.
“We thank Amazon for partnering with us to find a solution that works for our state,” Combs, who has been trying to get Amazon.com to remit back sales taxes to the state, said in a release.
“This is an important step in leveling the playing field in Texas," she said. "However, Congress should enact federal legislation that will give states access to revenues that are already due, which would resolve this issue fairly for all retailers and all states.”
“Amazon looks forward to creating thousands of new jobs in Texas and we appreciate Comptroller Combs working with us to advance federal legislation,” Paul Misener, Amazon.com's vice president of global. public policy, said in a joint release with Combs. “We strongly support the creation of a simplified and equitable federal framework, because Congressional action will protect states’ rights, level the playing field for all sellers, and give states like Texas the ability to obtain all the sales tax revenue that is already due.”
Texas and Amazon have been at odds over the collection of online sales taxes since last September, when Combs sent Amazon the $269 million bill, covering sales taxes the Comptroller said Amazon.com should have collected from 2005 to 2009. The bill included interest and penalties through the date of the assessment.
Combs has said Amazon is required to collect sales taxes on Texas transactions because it was operating a distribution center in Irving, constituting a physical presence.
Amazon has disputed that claim.
“While we continue to believe the assessment was without merit, in April 2012, we entered into a settlement with the State of Texas that included an agreement to collect sales taxes on applicable sales transactions for our U.S.-focused internet retailers beginning July 1, 2012, resolution of Texas sales taxes up to that date, certain commitments related to capital investment and job creation in the state, and an immaterial payment to the state,” Amazon said in a quarterly federal filing this morning with the Securities and Exchange Commission.
Amazon.com did not specify the amount of the payment.
Read more here: http://www.star-telegram.com/2012/04...#storylink=cpy
Last edited by Chuck Hamrick; April 27th, 2012 at 05:55 PM. Reason: Added content
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