SALT Blog - SALT Blawg

This is the year of the Amazon. Multiple sources, including individual affiliates, are reporting that Amazon, Overstock and other Internet retailers are severing ties with their affiliates in Connecticut and Arkansas. Both of those states recently enacted changes to their sales tax laws that required Internet retailers to collect sales tax on transactions made with persons in those states. The states were able to “reach” the Internet retailers through an expanded nexus by means of the “associate” or “affiliate” programs commonly used by such vendors.

Meanwhile ...

Some two weeks ago, we commented on the passage of House Bill No. 2403, a stand-alone version of the Amazon law that would have clearly required Amazon and other Internet retailers subject to collecting Texas sales and use tax on sales of tangible personal property if there was a link to a physical presence in Texas. Amazon had such a link via its distribution center near Dallas. A bill introduced by Rep. Harper-Brown to protect Amazon from such a requirement to collectTexas sales and use tax was buried in the House Ways & Means Committee.

On May 31, 2011, Texas Governor Rick Perry vetoed this ...

 By Paul Masters

With one lone dissent, the Texas Senate passed a bill last Friday, May 13, 2011, relating to Internet retailers doing business in Texas. As previously highlighted HB 2403 attempts to settle the issue raised by the Texas Comptroller on whether Amazon is engaged in business in Texas by setting up a distribution center in Texas. The Comptroller has already estimated a $269 million assessment against Amazon. This bill states that this is a "change in law," and that it does "not affect tax liability accruing before the effective date" of the legislation, being January 1 ...

 By Paul Masters

On Tuesday, the Texas House easily passed HB 2403. The bill addresses the “Amazon” issue, by subjecting a person to tax if the person has a distribution center in Texas, but also expands the definition of doing business in Texas to include any person who “derives receipts from the sale” of tangible personal property in Texas. This would presumably include Amazon affiliates, an issue hotly contested by Amazon in New York and other states.

Specifically, the bill modifies the Texas Tax Code as follows:

(i) redefines "seller" and "retailer" under the Texas Tax ...

Over the last two weeks, the dispute between Amazon, the online retailer, and the Comptroller of Public Accounts for the State of Texas has reached new heights. On Friday, February 11, 2011, Amazon advised its employees by letter that it would be closing the distribution facility in Irving, Texas, (which is owned by a subsidiary company), that it would relocate its facility and existing employees outside Texas, and would cancel expansion plans that would have created 1,000 new jobs. This latest move by Amazon follows the $269 million tax bill that Texas issued to Amazon in October 2010 for failing to collect sales tax on sales into Texas and Amazon's lawsuit filed to force the Comptroller to explain the factual and legal basis for the tax bill. Amazon is appealing the tax bill though the administrative appeal process available in Texas.

In response to the Texas Comptroller’s deficiency assessment of $269 million for uncollected sales and use tax, Amazon retaliated by filing suit in Travis district court for the production of “[i]nformation related to the audit and the assessment.” As of January 19, 2011, the Texas Comptroller had not been served and thus had no comment.

Other Texas retailers have complained to the Texas Comptroller of the unfair advantage given to Internet retailers such as Amazon who have not been collecting Texas sales and use tax.