With Amazon determined to avoid collecting sales tax in as many states as possible for as long as possible, Barnes & Noble issued an open letter to Amazon affiliates urging them to sign on to its affiliate program, which it says has over 13,000 members. As part of its strategy to limit the states where it collects sales tax, Amazon has ended affiliate programs in a few states that have passed legislation calling for all online retailers to collect sales tax from out-of-state e-tailers.
“We understand that Amazon.com has threatened to terminate its affiliate program in certain states that may enact e-fairness legislation that requires Amazon to collect sales tax due on purchases by residents in those states.” the letter begins.”Barnes & Noble is disappointed to hear that Amazon would threaten small businesses’ livelihood rather than comply with state law.” In large part because its stores gives it “nexus” in all states, B&N already collects sales tax for both its bricks-and-mortar stores as well as its online business. “Barnes & Noble wants Amazon.com affiliates who have been terminated to know that you are welcome to join the Barnes & Noble affiliate family. If Amazon doesn’t want you, we do! And, we will take care of collecting and remitting all sales taxes due on BN.com sales to its customers so you and our customers don’t have to worry about being hassled or prosecuted by state tax auditors,” the letter, signed by John Foley, president of BN.com, said.
Amazon’s most recent action to avoid collecting sales tax came last week when it said it was canceling plans to open a warehouse in Texas because that state’s comptroller has sued Amazon to collect what it says is $269 million in uncollected sales tax. The decision by the comptroller has drawn the wrath of governor Rick Perry who says without a store front Amazon does not have nexus in the state, even if it built a warehouse.