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Amazon to charge California sales tax by 2013

Published: October 4, 2011
Amazon will begin charging sales tax to California residents by 2013, according to the Wall Street Journal. Charging sales tax will eliminate a portion of the price advantage that Amazon currently enjoys over brick-and-mortar retailers.

Amazon and California lawmakers agreed earlier this month that California will delay enactment of a law that would require Internet retailers with California offices to charge sales tax until September 2012. Amazon, in turn, agreed to stop its efforts to pass a California ballot measure to stop the law, and to lobby for federal sales tax legislation.

Amazon CEO Jeff Bezos told the Journal that Amazon would not go to court or close its California facilities to avoid charging tax.

If Amazon is beginning to resign itself to the necessity for charging sales tax in its largest U.S. market, the handwriting may be on the wall for the eventual end of tax disparity between online and brick-and-mortar retailers.