Saturday, October 1, 2011

Amazon and State Taxes

Karl Denninger at Seeking Alpha has an interesting post on the future of Apple and Amazon. While I don't have sufficient knowledge to comment on the analysis of the valuations of the two companies, I do think that Amazon has at least one strategic move that it can make.

It would be very simple for Amazon to develop a reporting tool for its customers to calculate their sales tax liability and remit it to their individual states as required by state law. Amazon accommodates both the states and their customers without any change to current law at either the state or federal level. This would provide Amazon a defensible position and would put pressure back on the states.

It would be interesting to see if states would try to require Amazon to provide purchasing information to their revenue departments so that they could make sure to collect. (via Instapundit)