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Originally Posted by tomsem
KQED (SF NPR station) interviewed one of the CA Tax Commissioners yesterday. She was of the opinion (apparently shared by the sponsors of the law) that the new law required online retailers to collect taxes, regardless of whether affiliates program exists here. She said she 'hoped they would' (don't think she was under any illusions about this). Amazon has offices and employees in CA, though they are not storefronts.
Of course whether or not out of state retailers are legally required to collect the tax, CA residents are legally obligated to pay them. Amazon is certainly not the only online retailer that doesn't collect sales taxes, I would be hard pressed to name one that does (when they don't have CA B&N stores).
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Amazon has two subsidiaries, A9 and Lab126 both in the Silicon Valley, that work on developing Amazon's current and future technology. However, these are completely seperate businesses that are seperate from the retail business of Amazon (essentially Amazon just works as a venture capitalist). Other states have tried to link these types of subsidiaries with corporate parents so as to force the parent company to collect and pay sales tax, but they have all failed. California has even tried this in the past and lost.
If California suceeded this time around it would be truly catastrophic for them. A9 and Lab126 would leave California and so would hundreds of other tech firms that are started by venture capital from firms that don't want to collect sales tax -- not to mention all the tech firms that don't get funded in the first place. If Amazon funding tech firms like A9 and Lab126 is deemed to provide a nexus then California could expect to see VC dry up overnight. Not too smart.