Minnesotans Only Have A Week Of “Tax-Free” Shopping Left On Amazon

You can now add Minnesota to the growing list of states where Amazon will be collecting sales tax from customers after a surprise announcement on Monday that, starting Oct. 1, shoppers in the state will start seeing the tax added to their purchases.

Before we continue, this is where I remind everyone that even though Amazon and other online retailers might not collect sales tax in your state, you’re still obligated to pay those taxes when you file your tax returns with the state (except in those states without sales tax). Most people don’t, which is why some claim that Amazon has an unfair advantage over retailers that do collect taxes.

Okay, back to Minnesota.

It’s unclear exactly what brought this on. Amazon had been fighting efforts by the state to compel it to collect sales tax, even cutting ties to third-party affiliate sellers in advance of a 2013 state law that requires e-tailers to collect sales tax if it has affiliates in Minnesota.

The most likely explanation is that Amazon will be opening some sort of physical operation, like a warehouse or distribution center, or even a server farm for its Amazon Web Services business, in Minnesota.

Whatever the reason, the “tax-free” Amazon experience is coming to an end for Minnesotans who never got around to paying that money to the state every year.

Amazon now collects taxes in nearly half the states in the U.S. The retailer has said it supports federal legislation that would give each state the authority to compel online businesses to collect taxes, whether or not the business has a physical presence in the state. Numerous lawmakers have attempted to make this happen over the years, but without much success.

Amazon to collect Minnesota sales tax starting Oct. 1 [StarTribune.com]

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