May 11, 2011

Nevada business groups launch ad campaign to make Amazon collect taxes

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A worker in an Amazon warehouse in Femley, Nevada

The war to make Amazon collect state taxes kicked up to a whole ‘nother level yesterday, when a coalition of business owners in Nevada announced an advertising campaign to make the world’s biggest retailer and other internet retailers follow the same rules as brick-and-mortar retailers.

According to an Associated Press wire story by Scott Sonner, the announcement came from the Retail Association of Nevada and the Nevada Resort Association, which said they were “launching a $50,000 advertising campaign to build support for a change in tax laws so Amazon.com and dozens of other e-commerce companies would have to collect state sales taxes when they sell goods to Nevadans.” The groups plan to start running 30-second TV ads and 60-second radio spots this week in the state’s biggest cities, Reno and Las Vegas. Meanwhile they detailed “proposals they hope to persuade state lawmakers to consider as amendments to pending legislation as early as this week.”

Bryan Wachter, head of the Nevada Retailers Association, stressed what the coalition was after was “not a new tax. It is a collection issue.”

He explained current state law requires that, unlike with brick-and-mortar sales, residents must pay taxes on internet purchases themselves. However, as few residents know this, Wachtler estimates the state is losing $16 million dollars annually. “It’s such a backward way of doing it, different from how we do it 90 percent of time. It’s a tax fairness issue.”

The group also claims “the uneven playing field results in about an 8 percent disadvantage for Nevada retailers trying to sell the same goods with the sales tax attached.” Says Wachter, “It hits our small members the hardest.”

Amazon’s “vice president for Global Public Policy,” Paul Misener, responded that Amazon advocated a solution in Congress, where of course Amazon can outlobby the bejesus out of anybody (not an exact quote). Exact quote: Amazon “supports a truly simple national solution, evenhandedly applied,” said Misener. “Other state-by-state legislation is clearly unconstitutional.”

Meanwhile, a report in the Las Vegas Review-Journal notes that not all of Amazon’s subsidiaries agree with the mother ship on this one. The paper’s Jennifer Robison reports that the NRA and RAN “already have tacit support from Amazon-subsidiary Zappos.com,” the giant e-shoestore that Amazon bought in 2009 … and which has collected sales taxes since 2004.

Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House.

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