April 24, 2012, 10:35 AM

Amazon strikes a tax deal with Nevada

The e-retailer will start collecting sales tax no later than January 2014.

Thad Rueter

Senior Editor

Lead Photo

Amazon.com Inc. will start collecting sales tax on items bought by consumers in Nevada under an agreement announced late yesterday by Gov. Brian Sandoval.

The deal requires the e-retailer, No. 1 in the Internet Retailer Top 500 Guide, to collect the taxes starting Jan. 1, 2014, or earlier if a federal law is enacted that allows states to mandate sales tax collection by online retailers. The terms of the deal with the state’s Department of Taxation is similar to recent deals Amazon has signed with other states, including Virginia, Indiana and Tennessee.  

Sandoval, a Republican, says he will work for that federal law. “The only way to completely resolve this issue is for Congress to enact legislation that, within a simplified nationwide framework, grants states the right to require collection by all sellers,” Sandoval said in a statement. “We thank Amazon for creating jobs and investment in Nevada and are very grateful the company is working with us on a federal solution.”

The deal contains no apparent call for Amazon to build more distribution centers in Nevada or create more warehouse jobs. The governor’s office says Amazon has operations in the Las Vegas and Reno areas that employ thousands of workers. Amazon did not immediately return a request for comment.

 “Amazon appreciates Gov. Sandoval’s focus on Nevada jobs and his efforts to encourage Congress to resolve the sales tax issue this year,” said Amazon vice president of global public policy Paul Misener in a statement. “We strongly support federal legislation permitting interstate sales tax collection because it is the only way to level the playing field for all sellers, the only way for Nevada to obtain all the sales tax revenue that is already owed, and the only way to fully protect states’ rights.”

The sales tax rate in Nevada varies by county, but most of the state’s consumers pay a general 8.1% rate on purchases, which is what is charged in the the state’s most populous  county, Clark County, home to Las Vegas.  The Nevada tax deal reportedly will bring in no less than $16 million annually in tax revenue, though state taxing authorities did not immediately confirm that.

Stephen Kranz, partner at Sutherland Asbill & Brennan LLP, will discuss the online tax issue at the Internet Retailer Conference & Exhibition 2012 in Chicago in June in a session titled “The new urgency for developing a state sales tax strategy.”

Comments | 3 Responses

  • So does this mean that if I sell thru Amazon Market Place to a customer in NV I've got to collect and report sales tax? If that is yes, does it also mean I've got nexus and will have to collect NV sales tax from my website (non-amazon) and other channels? Re internet sales tax, if it is a flat rate across the country that everybody pays, then I can see the reasoning to that. BUT to have some company's not pay just because they are big (Amazon) sales tax is not right. Take Amazon. They've got 3 warehouse/distribution centers in Indiana my home state. If that isn't nexus I'm not sure what is. Yet they haven't payed sales tax on Indiana sales for a long time. But when I sell to Indiana, I must collect sales tax. And if I dont, I would expect to see somebody from the state knocking at my door! If a level playing field is to be created, it must be the same for all. Not very level for some and not so level for others. Bob

  • Just what we need- another FEDERAL law regulating the free market. Keep your hands off private enterprise, Feds!!!

  • The reason I shop on the Internet is to avoid the high Nevada sales tax of 8.1%. If it was like some of our surrounding states that charge 6.85% tax it would not be so bad. I use amazon a lot. Now I will look for other places to avoid the High Nevada sales tax! Bobbydo

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