It has been decades since the Internet was in its beginning and many of the states decided to allow the up and coming Internet businesses to escape sales tax. This was something that was designed to allow the industry to grow and now there is no reason for these businesses are ranking in billions of dollars without having to pay the taxes that the brick and mortar stores have to pay and it is costing states like California millions in tax revenue that is needed to pay for things like education and public safety.
How companies like Amazon have used the tax holiday to their advantage
It is obvious that companies like Amazon have had a free ride for too long now. It is not the Internet stores that are suffering anymore. These companies have been riding a tax holiday that was meant to allow these internet businesses to thrive and become what they are today; an industry. They days of Internet infancy have long past and many of these fortune 500 companies that are based in the Internet and technology industries have long been riding this Internet sales tax holiday. It has now been too long and Amazon will start adding sales tax to their sales.
Why Amazon is ending their Internet sales tax holiday
Amazon is growing by leaps and bounds every day, and with its growth it requires more facilities to accommodate the needs of the company. This is why is struck a deal with California governor Jerry Brown to help with bringing jobs to California, as well as help with tax relief help in CA by ending its tax holiday last Saturday. This means that if you live in California and buy from Amazon, you will be paying the California state sales tax from now on for the purchases that you make from Amazon.
What does this mean for other states?
While California will be one of the first for Amazon to end its tax holiday; there are other states that are slated for Amazon to start including sales taxes. This process will likely start a trend for many of these large Internet based corporations that have skated by without paying these taxes for years. The question is, what does this mean for the consumer. The short answer to this question is; everyone will have to pay the taxes that have not been paid for the duration of years. This means that everybody will be able to contribute to tax help in California, as well as other states, but at a price.