Weekly Round-up: Amazon.com and California Formalize Their Bargain


Amazon and California have struck a deal as Gov. Jerry Brown (D) signed a bill on Sept. 23 to repeal California's two-month-old online sales tax collection mandate until September 2012, BNA staff correspondent Laura Mahoney reports in this week’s issue of the Weekly State Tax Report.

In return, Amazon will now create thousands of new jobs in California and invest millions in the state, and “re-establish ties with thousands of affiliates that sold Amazon products through links on their websites before the law was enacted in June,” Mahoney writes.

Under the bill, A.B. 155, the new state law that requires online retailers to collect sales tax is repealed retroactively to the date of enactment but “will go back into effect Sept. 15, 2012, if no national rules are enacted by July,” Mahoney explains Joseph Henchman, at the Tax Foundation, thinks that it is unlikely that other states can get in on a similar deal.

For one, he writes, California represents a huge market for Amazon and the company is “leery of cutting its ties there.” "When you're California or New York across the table from an Amazon, it's a pretty big slice of the market," Kevin Sullivan, commissioner of the Connecticut Department of Revenue Services, explains in the Tax Foundation article. "We don't have the leverage that a New York has or the leverage that a California has."

In other developments,

Morrison & Foerster releases their Fall 2011 issue of State and Local Tax Insights, which covers, among other things, sales tax nexus in California, and bulk sale laws.

Josh Goodman, a Stateline Staff Writer, looks at New Jersey Governor Chris Christie's decision to reject tax credits for MTV's "Jersey Shore" reality show.

The California State Board of Equalization announces key executive team appointments.

BNA Tax Law Editor Kathleen Caggiano’s review of the emergency rules updating New York’s recently amended Excelsior Jobs Program can be read in its entirety here.

BNA Tax & Accounting will offer a webinar on Oct. 5 during which state tax experts will discuss “affiliate nexus” and what several states have done or propose to do to try to get more sellers to become sales tax collectors.

By Priya D. Nair

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