Amazon, in Agreement With State, To Begin Collecting Indiana Sales Tax

 LANSING, Mich.—Amazon.com Inc. will begin collecting Indiana sales tax, under an agreement with the state announced Jan. 9. [Ind. Governor's Office, News Release, 1/9/12]
The company will begin collecting and remitting state sales tax beginning Jan. 1, 2014, or within 90 days of enactment of federal legislation, if that happens sooner. Gov. Mitch Daniels (R) said he will continue to press for a “federal solution that treats all retailers and all states the same.”
Indiana's State Budget Agency and Department of Revenue estimate the state will receive revenue of $20 million to $25 million per year under the Amazon agreement. Overall, uncollected online sales taxes total about $75 million per year, Daniels' office said.
In light of the announcement, Simon Property Group Inc. said it will dismiss a complaint filed against the state last November over the issue. “As an Indiana-headquartered company that employs thousands of Hoosiers, Simon Property Group is pleased” with the agreement, David Simon, chairman, president and chief executive officer of the retail real-estate company said in a statement.
“Federal legislation permitting state sales tax collection must be enacted,” Amazon's vice president for global public policy, Paul Misener, said at a news conference with Daniels and Indiana legislative leaders. “It's the only way to level the playing field for all sellers, it's the only way for Indiana to obtain all sales tax revenue owed, and it's the only way to protect states' rights.”
Misener said Amazon's “fulfillment business” employs “more than a few thousand” Indiana residents, and the company has “made a few hundred million dollars in capital investments” in the state. “We are interested in bringing more jobs and capital investment to Indiana in the future,” he said.
The text of the news release is available on the internet at http://www.in.gov/activecalendar.
For More Information
For a discussion of sales and use tax nexus issues, see 1420 T.M., Limitations on States' Jurisdiction to Impose Sales and Use Taxes.