Online shopping will be forever changed by the Marketplace Fairness Act
Is Amazon the new Joe Fox of the publishing industry? The online shopping destination has proven itself to be a major threat to indies, brick and mortar, and publishers alike, but Amazon has surprised us all.
On Monday, April 21st, the Senate voted 74-20 in favor of the Marketplace Fairness Act. The act, S. 743, would allow states to collect sales tax from online sales. But don’t worry small businesses, it would would exempt small businesses that earn less than $1 million annually from out-of-state sales. This has been a concern to several senators including Sen. Jeanne Shaheen (D-N.H.), but those worries are completely unfounded, as explicitly stated in the bill.
But really, isn’t it only fair? That is exactly what Sen. Dick Durbin (D-Ill.), who is a co-sponsor of the bill said:
“It’s only fair to the businesses across America, if they are required to collect sales tax on their sales, that those competing with them ought to do the same.”
So let’s get back to the big shocker here…Amazon is in full support!
In his article on the subject for DailyFinance, Matt Brownell reported Paul Misner, Amazon VP, saying:
“Amazon.com has long supported a simplified nationwide approach that is evenhandedly applied and applicable to all but the smallest volume sellers. With this in mind, I am writing to thank you for your bill, which will allow states with simplified rules to require sales tax collection by out-of-state sellers who choose to make sales to in-state buyers.”
The fact is, Amazon has been on this path towards supporting sales tax on online sales taxes for a while now. Misner is gifted in predicting his industry, and he knows that the Marketplace Fairness Act is an inevitability of the digital future.
Amazon made this turn in 2011 after going nuclear on the state of California when it passed a similar law. However, Amazon soon changed its tune when it struck a deal with the state in which Amazon would be granted a one year leniency on tax if they continued the building of two fulfillment centers in the northern part of the state. California eagerly agreed, as it would bring over 2,000 new jobs to the state. A similar deal was struck in South Carolina as well.
The genius of Misner is his ability to adapt and evolve with his industry. Amazon sees the inevitability of online sales tax and will continue to support the Marketplace Fairness Act, a blessing to state’s income, and to the future of our indies and bricks and mortar booksellers, as it will even out the playing field, even if it is only by a small margin.
The opposition to the bill is coming from conservative GOP members and lawmakers from Montana, New Hampshire, and Oregon (which don’t have sales tax).
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