States Where Amazon Collects Sales Tax
In recent years, the issue of sales tax collection on online purchases has become a hot topic of debate. One of the largest online retailers, Amazon, has faced scrutiny and legal battles over its sales tax practices. However, in an effort to comply with state laws and regulations, Amazon now collects sales tax in many states across the United States. This article will provide an overview of the states where Amazon collects sales tax, as well as address some frequently asked questions on this topic.
As of 2021, Amazon collects sales tax in the following states: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.
1. Why does Amazon collect sales tax?
Amazon is required by law to collect sales tax in states where it has a physical presence, such as warehouses or offices. This is known as the “physical presence” or “nexus” requirement.
2. Do I have to pay sales tax on Amazon purchases?
Yes, if you reside in a state where Amazon collects sales tax, you are required to pay sales tax on your purchases. The sales tax amount is determined by the state and local tax rates.
3. What if I live in a state where Amazon does not collect sales tax?
If Amazon does not collect sales tax in your state, you may still be responsible for paying a use tax on your purchases. Use tax is generally owed by the purchaser if sales tax was not collected on the transaction.
4. Does Amazon collect sales tax on all items?
Amazon collects sales tax on most items sold directly by Amazon. However, sales tax may not be collected on certain items sold by third-party sellers on the Amazon marketplace.
5. Can I avoid paying sales tax on Amazon purchases?
If you live in a state where Amazon does not collect sales tax, you may be tempted to avoid paying it. However, it is important to comply with the law and pay any applicable use tax.
6. Can I get a refund for sales tax on returned items?
Yes, if you return an item to Amazon and receive a refund, the sales tax you paid on that item should also be refunded to you.
7. What if I purchase an item from a third-party seller on Amazon?
If you purchase an item from a third-party seller on Amazon, the sales tax collection may vary. Some third-party sellers may collect and remit sales tax, while others may not. It is important to review the seller’s policies before making a purchase.
8. Are there any exceptions to sales tax collection by Amazon?
In some cases, Amazon may have agreements with certain states to waive sales tax collection for a limited period or under specific circumstances. However, these exceptions are relatively rare and vary by state.
In conclusion, Amazon now collects sales tax in the majority of states across the U.S. This change in their sales tax practices has helped them comply with state laws and regulations, ensuring a level playing field for brick-and-mortar retailers. It is important for consumers to be aware of the sales tax requirements in their state and understand their obligations when making purchases on Amazon or any other online retailer.