Media Criticism Continues as Amazon Seeks Petition Signatures

Rather than collect and remit sales tax in California, Amazon.com is working to collect 500,000-plus signatures to secure a referendum vote in an attempt to overturn the state’s recently enacted sales tax fairness law [1]. However, even as the signatures are being collected, the drumbeat of editorials, columns, and op-eds lambasting Amazon for seeking a voter referendum to protect its tax loophole grows louder.

Here’s a rundown:

• The headline of John B. Judis’s column in The New Republic pretty much says it all, “Amazon.com: Terrible Corporate Citizen [2].” Judis writes, “I’m a longtime customer of Amazon … but I’m looking for an alternative. I’m not unhappy with Amazon’s service, but with its politics. Amazon is waging an aggressive campaign to prevent revenue-starved California from collecting sales taxes from the company’s customers. And that’s only its most recent effort to prevent states from levying sales taxes on online purchases.”
•  In the Mother Jones column “Amazon’s Scorched-Earth War Against the Rest of Us [3],” Kevin Drum notes, “With most states still hammered by depressed tax collections thanks to the poor economy, this means that Amazon’s remorseless resistance to collecting taxes is in direct conflict with funding for schools, parks, medical care, and street repairs.”
• The Ventura County Star editorial “Wise voters won’t buy into Amazon.com’s sales-tax scheme [4]” stresses, “The world’s largest online retailer is doing the wrong thing — economically, politically and socially — by backing a referendum to help it avoid collecting sales tax from its California customers. The Star suggests that registered voters simply refuse to sign the petitions that soon will be circulated by paid signature gatherers as Amazon tries to put its referendum on the ballot.”
• The Los Angeles Times editorial “Don’t buy Amazon’s argument, California [5]” states: “Amazon.com is asking California voters to use their ballots to sustain its business advantage. That’s a move that even Californians who have gotten used to (and gotten away with) not paying their taxes on Internet purchases ought to reject.”
• The Economist editorial “The Amazon war -- More complicated than the Boston tea party, but potentially as colourful [6]” discusses Amazon’s campaign strategy to “evoke sympathy” for in-state affiliates. “Thus its publicity folk call the upcoming ballot measure a ‘referendum on jobs and investment in California.’ The logic is tenuous: it is, after all, Amazon which is firing these local entrepreneurs (some 10,000 in California alone this month) as a way to avoid collecting tax.”
• In the Knoxville News Sentinel column “Uncollected Internet sales tax unfair [7],” Roger Harris writes: “Sales tax law should be applied equally to all retailers, whether online or traditional. No one likes to pay taxes. Not paying sales tax when you buy a $1,600 refrigerator from Amazon.com is very popular with consumers. It takes a politician with real backbone to take a stand against such a popular tax loophole. The arrogance of online retailers will cost states $12 billion in uncollected state and local sales taxes in 2012, according to a study by the University of Tennessee Center for Business and Economic Research. In Tennessee alone, uncollected Internet sales taxes will total $410 million in 2012.”
• In the Sacramento Bee column “Viewpoints: Amazon is banking on your anti-tax sentiments [8],” Bruce Maiman states: “In reaction to the new law, Amazon cut its ties with California affiliates. Result … They lose money, go out of business, maybe leave the state. ‘Job killer!’ cry Internet tax opponents. Wait: I’m supposed to be sympathetic to businesses that were taking advantage of a loophole that never should’ve existed in the first place? It’s like a gas pump accidentally set at $1 a gallon and motorists lining up to advantage themselves of an existing flaw. You don’t complain when that gets corrected; same thing here.”
• The Sacramento Bee editorial “Referendums running amok! [9]” notes that “Amazon’s aggressive stance against playing by the same tax rules as other retailers has hurt Amazon’s reputation. As Marty Manley, co-founder of the Alibris global exchange for rare books, has written, ‘The cost of collecting sales taxes is trivial relative to the cost of being branded the nation’s number-one tax evader.’”
• “Amazon.com makes a taxing argument [10],” says Jon Talton in the Seattle Times: “Jeff Bezos could care less about me and my sensibilities. (Disclosure: My mystery novels are sold on Amazon as well as in traditional bookstores.) He cares a great deal about not accepting a responsibility that is a given for most other retailers: Collecting sales taxes. He doesn’t really put it that way, instead cloaking it in the fiction that this huge company can’t handle the bother of complying with different laws in each state.”
• The Indianapolis Star editorial “Eliminate unfair tax advantage [11]” points out the cost of providing Amazon sales tax sanctuary. “[T]he legislature and the Daniels administration have provided sanctuary from online sales taxes and Amazon has returned the favor with three distribution centers and a fourth on the way. That’s a lot of jobs and a lot of happy voters. It’s also a great many unhappy brick-and-mortar retailers and an estimated loss of nearly $400 million a year in tax revenue. Not only does the situation amount to unfair competition, spokespersons for Indiana’s retail industry say; it also hurts the bottom line: Businesses small and large that must pay the sales tax Amazon avoids will cut back, go bust or leave Indiana, subtracting from the job and property tax total that Amazon enhances.”
• In the posting “Jeff Bezos vs. our schools [12]” on the Boston Business Journal blog, “The Bottom Line,” Eric Convey writes: “Amazon also wages war on efforts to tax Internet commerce, well within its rights. By doing so — by helping consumers avoid paying sales taxes — Amazon and companies like it are siphoning hundreds of millions of dollars from state treasuries.”