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Amazon: Don't Take Rented Textbooks Across State Lines


 Amazon rents textbooks on condition that renters not take them out of state.

Back when I was in college, textbooks were available at the University Bookstore, new or used. Renting textbooks was unheard of. Not so, today. Companies such as Amazon.com and Chegg.com have changed that.

Amazon began renting digital textbooks in 2011. It launched a textbook rental program with bound books in the summer of 2012; students must return the rented books (in good condition) within 130 days but can make arrangements to extend the rental if need be. E-books or bound books, renting textbooks offers students substantial savings. For example, an accounting textbook that sold for $195.47 in 2011 could be rented in hard copy for $57.00 and as an e-book for $53.79.

The fine print: anyone who rents textbooks from Amazon is not allowed to bring them across state lines.

This policy is clearly stated on Amazon's website under the heading, Rentals by Warehouse Deals, Inc:

"You may not move the textbook out of the state to which it was originally shipped If you wish to move the textbook out of that state, you must first purchase the textbook…. 

If we determine that at any time during the rental period you have moved a textbook rented from Warehouse Deals, Inc, out of the state to which it was originally shipped, we may in our sole discretion charge you the buyout price of the textbook and transfer title to the textbook to you…."

In other words, if you rent a textbook while at school in Pennsylvania and then take it to a friend's house in New Jersey over a long weekend, you may have to purchase the book. If Amazon discovers what you did. Is Amazon watching?

Why?

The motivation behind this policy seems to be the desire to avoid creating nexus in another state. Avoiding sales tax has been central to Amazon's strategy since the beginning. While Amazon has lobbied in support of the Marketplace Fairness Act of 2013 (federal legislation that would allow states to impose sales tax collection requirements on certain remote vendors), it has also cut off affiliates in states where affiliate nexus laws have been imposed.

Since the economic downtown and the noticeable decrease in state revenues, Amazon's "tax evasion tactics are attracting increased attention." Some states, like use tax in an attempt to discourage residents from shopping in neighboring counties or online.

Students may or may not care about Amazon's sales tax policy--most are probably looking for the least expensive way to obtain textbooks. They may or may not think about it when bringing textbooks home during a long weekend.

And if Amazon starts aggressively going after renters who cross state lines with textbooks, we'll have bigger issues than sales tax on our hands.

How does your business handle sales tax?

photo credit: flickr./com/photos/amanda_munoz via photopin cc


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.