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Internet Retailer Amazon to Start Collecting Sales Taxes

Apr 17, 2014

Floridians who rely on Internet giant Amazon.com will have to soon start paying taxes on their online purchases.

A spokesman for the Seattle-based company confirmed Wednesday that Amazon will collect the state's 6 percent sales tax on May 1.

The move follows the decision by Amazon to build two distribution centers in the Sunshine State.

Amazon will open "fulfillment centers" in Lakeland and Ruskin. Each will be more than 1 million square feet. Amazon officials say when both are open, more than 1,000 full-time jobs will be created.

The Lakeland center would be on County Line Road, on the border with Hillsborough County. In July, Polk County commissioners approved a $4.5 million incentive package that requires Amazon create at least 100 high-paying jobs and make a minimum investment of $10 million.

Hillsborough County commissioners previously approved economic incentives worth more than $6 million over seven years.

The deals also mean that Florida residents will have to pay a six percent sales tax on all merchandise bought through the retailer.

Currently, Floridians are supposed to pay taxes for online purchases, but there's no way to enforce the law. The state can't force companies like Amazon to collect the tax unless it has a physical presence, such as a warehouse or store.

Last year, Gov. Rick Scott and Amazon announced a deal in which the company would create 3,000 new jobs in Florida by 2016. The exact details of the deal were kept confidential by state officials.

Initially, Scott rejected a proposed deal with the company because of concerns it would result in higher taxes for Floridians. But he reversed that decision last June.

Amazon's decision to expand in Florida reflects the retailer's desire to put in a system to guarantee quicker delivery of products ordered online. The company has reached similar agreements regarding warehouses and payment of sales taxes in several other states.

Retailers in Florida have been pushing for years for state legislators to change state law in an effort to prompt Internet retailers to collect sales taxes. Representatives of brick-and-mortar stores contend that online companies have an unfair competitive advantage. But despite winning support from some Republicans, the bills have repeatedly stalled in the state Legislature.

A representative with the Florida Retail Federation said the group was pleased that Amazon would soon start collecting sales taxes.

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