Amazon’s Sales Tax Deal Moves Toward Becoming State Law

Tennessee’s deal with to put off collecting sales tax is moving quickly through the legislature.

When the Internet retailer began building distribution centers in Tennessee last year, competitors complained that they have to collect sales tax while the on-line store was home free.

Amazon and the state negotiated that issue through two governors’ administrations.
Under the final compromise, Amazon begins collecting sales tax in 2014.

The deal zoomed through a subcommittee and is one step away from a vote in the state House. Majority Leader Gerald McCormick is shepherding the legislation.

“Sales tax is already due, when you buy items on-line from Amazon. This just puts it into law that Amazon will collect that sales tax, rather than just letting you know you’re supposed to send money to the state.”

McCormick says he’s pretty sure most Tennesseans aren’t voluntarily writing a check to the state to cover the tax on their on-line purchases.

The bill is HB 2370 McCormick / SB 2232 Norris.

Although brick-and-mortar merchants – folks who have retail establishments in the state – weren’t pleased with the delay until 2014 when it was announced last fall, they haven’t raised any objection to the bill which puts the compromise into law.

McCormick has already moved several of the bills in the governor’s legislative package.

“Most of the time when the governor has a package no matter who the governor is, most of it is not that controversial, so it moves pretty quickly . We’re trying to get them on notice. And move them quickly, though, because we do want to get finished.”

Getting a bill “on notice” means scheduling it to be heard in a committee.

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