Arkansas "bad" according to Amazon | Arkansas Blog

Thursday, August 4, 2011

Arkansas "bad" according to Amazon

Posted By on Thu, Aug 4, 2011 at 4:36 PM

A Wall Street Journal report (if you're not a subscriber, click here to get to the article through Google) details the efforts of Amazon to avoid sales tax collection all over the country, including so-called "bad states" like the one we live in. A bill passed last legislative session that would require Amazon to collect sales tax on purchases made through Amazon.com. Before the bill was passed, the buyer was responsible for remitting that sales tax to DFA themselves (How often did you buy $100 worth of books online and then write DFA an $8 check to put in the mail?). But the bill only required Amazon to collect sales tax in states in which it had an affiliate operation, like a warehouse or a web-based ad program that would give websites a commission based on traffic directed to Amazon. As soon as the bill passed here, Amazon stopped operating these programs in Arkansas to avoid collecting the taxes. So we're basically back where we started. If you buy something from Amazon, you're responsible for remitting the sales tax to DFA. Now comes a group that advocates putting that tax collection onus back on Amazon. It's going to take an act of Congress to do it. It's not really clear what that might look like just yet - maybe a federal mandate to do so, or a bill that would let individual states decide how to handle it. From the Stand With Main Street release:

“The truth of the matter is that Amazon has been going to extreme lengths for years to avoid complying with Arkansas tax laws, even before we passed legislation establishing new requirements for companies with a physical presence in the state,” said Robert Coon, spokesman for the Alliance for Main Street Fairness in Arkansas. “Sales tax avoidance seems to be priority number one for this Internet company and anyone who jeopardizes their ability to skirt the law gets thrown by the wayside, including our in-state affiliates. It is clear that now is the time for Congress to address the issue and give states the authority they need to close this tax loophole once and for all.”

Internal Documents Demonstrate Amazon’s History Of Skirting Arkansas Tax Laws
Internet Company Belongs On “Bad” List Not Natural State

FOR IMMEDIATE RELEASE
August 4, 2011

Little Rock, AR — While Amazon.com recently cut ties with Arkansas affiliates to avoid complying with new sales tax collection rules passed by the General Assembly, their efforts to skirt the state’s tax laws are nothing new. Just yesterday, The Wall Street Journal reported on Amazon’s extensive efforts to avoid sales tax collection throughout the country, specifically in 19 declared “bad states” including Arkansas that had strict laws on sales tax collection.

According to the report:

“In the 2000s, Amazon documented the restrictions in a U.S. map that shaded each state red, yellow or green and was given to new employees, said three people who saw it. It couldn't be determined precisely which staffers received it and to what extent the practice is followed today.

“Other employees received a spreadsheet with two columns: ‘bad states’ and ‘safe states,’ said a person who saw the document within the past year. One copy of the spreadsheet, reviewed by The Wall Street Journal, listed nine ‘safe states,’ including the four states where Amazon declares retail operations. The spreadsheet listed 19 "bad" states, including Arkansas, Connecticut, Illinois and Texas, which have sought to expand taxation of online sales.”

“The truth of the matter is that Amazon has been going to extreme lengths for years to avoid complying with Arkansas tax laws, even before we passed legislation establishing new requirements for companies with a physical presence in the state,” said Robert Coon, spokesman for the Alliance for Main Street Fairness in Arkansas. “Sales tax avoidance seems to be priority number one for this Internet company and anyone who jeopardizes their ability to skirt the law gets thrown by the wayside, including our in-state affiliates. It is clear that now is the time for Congress to address the issue and give states the authority they need to close this tax loophole once and for all.”

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