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Massachusetts: Heading Toward Online Sales Tax?


Many voices in the state of Massachusetts are calling for online businesses to collect the state's sales tax. These efforts are being spearheaded by the Massachusetts Main Street Fairness Coalition (MMSFC), an organization that counts among its members many Massachusetts mayors.

According to the MMSFC, the organization recently submitted a letter to Governor Deval Patrick, "asking him to 'more aggressively' force online giant Amazon.com into compliance with Massachusetts sales tax laws before the all-important holiday shopping season."

The MMSFC argues that since Amazon now owns a robotics company based in North Reading and a research office in Cambridge, there is "a physical presence for Amazon and a clear nexus that requires them, under existing law, to register with the DOR to collect and remit sales tax on purchases made by MA residents."

Mayors from Boston, Salem, and other communities around the state believe that requiring online companies to collect sales tax would level the playing field for brick and mortar stores that do collect Massachusetts sales tax. The letter to the Governor states that each morning, "when a Massachusetts retail business opens, he or she starts at a 6.25% price disadvantage to online giants like Amazon.com."

In an article from The State House News Service, Governor Patrick is quoted as saying in June that "his administration would begin talks with Amazon." The Governor said in a September 27 broadcast of "Ask the Governor" on WTKK-FM, that "Amazon is interested in expanding their presence here, and we are engaged with them on that and [on] entering into an agreement to collect Massachusetts sales taxes."

Amazon.com collects sales tax in California, Kansas, Kentucky, New York, North Dakota, Pennsylvania, Texas, and its home state of Washington. The company is slated to start collecting sales tax in New Jersey, where it is building two new warehouses, by July 1, 2013 (New York Times).

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.