What is in this article?:
- E-tailer sales tax riles Amazon
- Industry mixed on e-tailer sales tax
Now required to collect sales tax from its California customers, e-commerce giant Amazon.com looks to brick-and-mortar stores for support in overturning the law. We explore how the natural products industry feels about taxing e-tailers.
Which sales channel experienced the greatest growth in natural products sales last year? If you guessed online outlets, you were right. E-commerce sales of natural and organic products increased a robust 14 percent in 2010, according to Natural Foods Merchandiser’s 2011 Market Overview. As e-tailers continue to grab more sales in many retail categories, states are taking notice and beginning to demand a piece of the tax pie.
California recently became the seventh state to pass a law requiring online retailers to collect sales tax from shoppers. The legislation requires all large out-of-state e-tailers with some affiliation in California, such as having employees and warehouses located in the state, to collect sales tax on purchases. The law is expected to raise an estimated $317 million for cash-strapped California.
Some online outlets are calling the law unconstitutional and seeking to have it overturned. Internet giant Amazon.com has been gathering signatures, hoping to obtain the 500,000 necessary to get a measure overturning the law on the California ballot next June, the Los Angeles Times reports. Not surprisingly, the company is targeting popular brick-and-mortar stores to collect signatures and rally supporters.
“Petition workers are swarming popular commercial hubs including Larchmont Village in Los Angeles, Colorado Boulevard in Pasadena and the Gaslamp Quarter in San Diego as well as Ralphs, Trader Joe's, Target and other major retailers—many of which have lost sales to Amazon," said the LA Times.
