When Amazon begins collecting sales tax next month in New Mexico, Hawaii, Maine and Idaho, it marks the first time that the company will collect sales tax in all 45 states that have sales tax, which yesterday the American Booksellers Association called a victory for booksellers and Main Street retailers.
In Bookselling This Week, ABA CEO Oren Teicher commented, "It is safe to say that the arguments that we have been making--about fairness and equity--have finally won out. The campaign for e-fairness was a long one--longer than we expected--but now that Amazon collects in every state that has sales tax laws on the books, independent booksellers everywhere can take great pride in a remarkable accomplishment."
The e-fairness effort goes back to the late 1990s. "For much of the new century, Amazon.com used its sales tax advantage to aggressively grow its sales and market share, and, along the way, the retailer vigorously fought against collecting and remitting sales tax to states," BTW wrote. "But the persistent advocacy efforts of Main Street retailers, led by indie booksellers, and growing bipartisan support at both the state and federal levels--coupled with numerous, decisive blows in the courts and Amazon's move to a rapid delivery model--brought about Amazon's strategic reversal."
Now, in a similar battle, Main Street retailers, the ABA and others--including Advocates for Independent Business, of which the ABA is a co-founding member--are fighting against local and state governments and agencies' increasing subsidization of Amazon's warehouse growth across the country. A key part of the educational effort has been the study the ABA commissioned from Civic Economics, Amazon and Empty Storefronts, which highlighted the retailer's pernicious effect on jobs, governments and communities across the country.
Bloomberg BNA Tax & Accounting has pointed to a study by the progressive economic policy research and advocacy group Good Jobs First that says this year Amazon will "vault past a record for state and local tax subsidies held for many years by Wal-Mart Stores Inc., the undisputed king of brick-and-mortar retail sales." The group estimates that Wal-Mart has won "more than $1.2 billion in tax abatements, credits, exemptions, infrastructure assistance and financing deals during four decades of rapid expansion that has left the company with 4,672 retail locations across the country."
At the end of last year, Amazon's similar subsidies were estimated at about $1 billion. Bloomberg noted, "The new year began with Amazon committing to build out its rapid-delivery business model, and states and municipalities lined up to help. In less than three months, Amazon racked up another $92 million in tax credits and exemptions to develop warehouses and fulfillment centers in California, Illinois, Kentucky, Maryland and Michigan."
"Amazon is a juggernaut in terms of tax breaks," Greg LeRoy, executive director of Good Jobs First, told Bloomberg BNA. "They were pulling down $125 million annually for at least two years and they are on pace for that in 2017, given the deals we've seen already for the year. So it won't be long before they surpass Wal-Mart."
