The Days Of Tax-Free Shopping On Amazon.com Are Coming To An End

Amazon.com is about to start collecting sales tax on purchases made in Texas. This settles a dispute between the online retailer and the state comptroller's office.

For years, Texans have been buying things on Amazon tax-free. 

Lawmakers recently closed a loophole that allowed online retailers to get around collecting sales tax. Lauren Willis with the Texas Comptroller of Public Accounts says previous negotiations with Amazon didn't go anywhere.

"We resumed talks about probably two, to two-and-a-half weeks ago. And they agreed, starting July 1st, to start collecting those taxes."

This comes about a year after Amazon said it was closing a Dallas-area distribution center and scrapping plans to expand operations in Texas.  Willis says the agreement with Amazon will result in more than just sales tax.

"They are planning to bring, over the next four years, 2,500 jobs to the state. And they're planning to invest $200 million in distribution and other types of facilities here, in Texas. So we're excited about that."

Exactly where those facilities will be located is yet to be announced. The state is still calculating exactly how much extra revenue it can count on, once Amazon starts collecting sales tax. A University of Tennessee study found that untaxed sales over the Internet have cost states $52 billion in lost revenue over the last six years.

 

The University of Tennessee study referenced above:

 

 

 

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David Pitman

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