Amazon To Pay Sales Tax In Florida

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Amazon To Pay Sales Tax In Florida
By Szk7788 (Own work) [CC BY-SA 3.0 or GFDL], via Wikimedia Commons

The state of Florida could reap as much as $80 million in new revenue from Amazon.com, Inc. (NASDAQ:AMZN) paying a state sales tax that could impact as many as 20 million people, according to a report in the Wall Street Journal.

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Warehouse building spree triggers sales tax collection obligations

After moving warehouses into the fourth-largest state in the country, Amazon is subject to a 6% sales tax.  In order for an online retailer to pay sales tax, they must have an office or warehouse in the state.  Amazon is building new warehouses in Ruskin and Lakeland, near Tampa and Orlando.

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As much as 60% of Amazon’s US customers now pay sales tax

After the addition of a Florida facility, as much as 60% of the US population – 190 million citizens – will now be subject to state sales tax on purchases from the Seattle firm.  Florida is the 21st state to charge sales tax on Amazon purchases, the report noted.

Strategy change in sales tax avoidance

A key to the Amazon strategy had been to offer products without requiring customers to pay sales tax, providing a benefit over brick and mortar retailers.  Over time, Amazon’s aggressive avoidance of paying sales tax lessened and it is now seeking to build distribution around the country.  In fact, the online retailer lobbied in favor of a national sales tax for all online retailers, known as the Marketplace Fairness Act, according to the report.  With this new law, passed by the US Senate last year, online retailers with at least $1 million in yearly out of state sales would be required to collect sales tax from customers.

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Mark Melin is an alternative investment practitioner whose specialty is recognizing a trading program’s strategy and mapping it to a market environment and performance driver. He provides analysis of managed futures investment performance and commentary regarding related managed futures market environment. A portfolio and industry consultant, he was an adjunct instructor in managed futures at Northwestern University / Chicago and has written or edited three books, including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008). Mark was director of the managed futures division at Alaron Trading until they were acquired by Peregrine Financial Group in 2009, where he was a registered associated person (National Futures Association NFA ID#: 0348336). Mark has also worked as a Commodity Trading Advisor himself, trading a short volatility options portfolio across the yield curve, and was an independent consultant to various broker dealers and futures exchanges, including OneChicago, the single stock futures exchange, and the Chicago Board of Trade. He is also Editor, Opalesque Futures Intelligence and Editor, Opalesque Futures Strategies. - Contact: Mmelin(at)valuewalk.com
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  1. On line shoppers will not start going to the stores. They will find other stores. The additional revenue in taxes for Florida is a legal and appealing way for the Medicare thief turned snitch Governor to put his hands on more money. Floridians will never see this sales tax money. Never.

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