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Amazon to Collect Online Sales Tax in Texas

Deal erases $269 million debt for uncollected taxes.

Amazon has resolved a little matter of a $269 million tax bill from the state of Texas by agreeing to start collecting online sales tax in the state on July 1, and add thousands of jobs over the next four years.

As part of the deal announced Friday, Amazon also pledged to make at least $200 million in capital investments in Texas between now and 2016.

In a joint statement, Texas Comptroller Susan Combs and Amazon Vice President of Global Public Policy Paul Misener called on Congress to pass federal legislation that would “level the playing field for all sellers,” and make it easier for states collect tax revenue.

Amazon earlier said it would close its Dallas-area distribution facility on April 12, after Texas officials demanded the online retailer pay four years worth of uncollected sales tax, plus penalties and interest. According to local news reports, the company did lay off the site’s 119 employees, but continued operating with temporary workers, possibly in anticipation of reaching an online sales tax agreement with state officials.

Several states have struck similar pacts with Amazon, including Nevada, Indiana and South Carolina, usually with a tax-collection deadline several years in the future. In California, Amazon must begin collecting online sales tax on September 15.

About the author

Crista Souza
Crista Souza is founding editor of A journalism graduate of San Jose State University, she spent 13 years as a business and technology reporter in Silicon Valley. Crista has been writing about B2C and C2C ecommerce since 2008. Opinions expressed here may not be shared by The Online Seller and/or its principals.

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