The White House endorses an Internet sales tax, So does Amazon.com

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It isn’t fair that traditional brick and mortar stores have to charge sales taxes and online merchants don’t. But as usual with these bills there’s more to the “Marketplace Fairness Act” than one might initially think.

Interestingly there has been a corporate drive for the tax, pushed in a big way by Amazon.com which has built distribution centers around the country in an effort to better position themselves to offer same day delivery. (And to take on Walmart.) Amazon increasingly must already pay taxes because of this change in its model, and now sees an online sales tax as a way to squeeze smaller competitors who will have to deal with the over 9600 taxing authorities in the USA.

Amazon can afford to handle this burden. For a company with $1.1 million in revenue to comply with the Act will be much harder. (The Act as written now will only apply to merchants with revenues of over $1 million, not a lot by retail standards.) Perhaps prohibitively so.

I guess those smaller online merchants can just become Amazon.com affiliates, which is likely part of what is behind online tax push by the giant.

Regardless, the White House is now officially on board, and it appears that both the GOP and Dems are on board in the House and Senate. So, it looks like I’m going to be paying a bit more for my next pair of running shoes.

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