Sales Tax Initiative

Over the past two months, there have been significant strides in the campaign for e-fairness that have thrust the issue into the media spotlight. To keep the issue on the minds of legislators, the American Booksellers Association is urging booksellers to write, fax, or e-mail their governors about this important issue.

The State of Texas Comptroller's Office is currently investigating whether the presence of an Amazon.com-run distribution facility in the Dallas suburb of Irving means the online retailing giant has a physical presence in the state. If the Comptroller's Office determines that Amazon.com does have nexus, the retailer would be responsible for collecting and remitting sales tax for purchases made by Texas residents and potentially would be liable for back taxes.

Associations call on non-New York State businesses to contact their governors

On May 2, Amazon.com, LLC, and Amazon Services, LLC, announced that as of June 1 they would begin collecting sales tax on sales to New York State residents. This decision comes even as Amazon.com pursues its legal action against New York State over its Internet Sales Tax provision. As reported yesterday in Bookselling This Week, on April 25, Amazon filed a complaint in the Supreme Court of the State of New York that challenges as unconstitutional the provision in the state's budget.

Amazon.com, LLC, and Amazon Services, LLC, have filed a complaint in the Supreme Court of the State of New York that challenges the Internet Sales Tax provision in the state's budget. In a complaint filed on April 25, Amazon claims that the provision is "unconstitutional" because the statute "requires out-of-state Internet retailers, with no physical presence in New York, to collect sales and use taxes," as reported by Wired.

On April 15, Gov. David Paterson signed into law the Internet Sales Tax provision, as reported by Multichannel Merchant. The Internet Sales Tax provision requires out-of-state retailers such as Amazon.com to comply with New York State sales tax laws and to collect and remit sales tax on sales to state residents.

Last week, independent retailers in New York State scored a huge victory when the legislature passed a final budget that includes the Internet Sales Tax provision. While Gov. David Paterson is expected to sign the budget bill into law without any line-item vetoes, as of press time, he had yet to do so. Meanwhile, though experts expect there to be a legal challenge to the provision from the likes of Amazon.com or the Direct Marketing Association, no suit has been filed in court.

In what was a significant victory for independent retailers, on Wednesday, April 9, the New York State Legislature passed a final budget that includes the Internet Sales Tax provision. This means that out-of-state retailers such as Amazon.com now will be required to comply with New York State sales tax laws and collect and remit sales tax on sales to state residents. Gov. David Paterson has 10 days to sign the budget.

At press time, the April 1 deadline for the New York State budget had come and gone, and it was still unclear when Gov. David Paterson and the New York legislature would reach a final agreement. News accounts from Albany indicate that the Internet Sales Tax provision remains in the proposed budget; however, with negotiations still ongoing, no provision is guaranteed inclusion in the final document.

As New York State legislators returned to the capital following their Easter break, and the state's budget deadline of April 1 looms, the American Booksellers Association continued its lobbying efforts on behalf of the proposed Internet Sales Tax provision's inclusion in the final state budget.