US Sales Tax (‘Amazon Tax’) on internet commerce takes grip

Tue 5th Mar 2013

California, US, is reporting good initial revenues from its new US Sales Tax on e-commerce sales by out-of-state online retailers. This is often dubbed the ‘Amazon Tax’, after the ubiquitous online retailer.

California introduced the tax to equalise the commercial terms vs. in-state online retailers and traditional high-street stores who have always been subject to sales tax. In the last quarter of 2012, the take was just under $100 million. This compares to a total annual target of $11 billion across the whole of the US, set by the University of Tennessee.

Many other states will be introducing similar taxes in the forthcoming months. It is already up and running in nine states. New York is still battling with online retailers over its new sales tax, and expects a court decision in the summer.