Tennessee follows California with new Amazon tax deal

Summary:We are starting to see Amazon work out tax collection deals state by state.

Tennessee is the latest state to work out a deal with Amazon in which the online mega-retailer will have to collect state sales taxes.

However, it won't be happening right away. The Associated Press reports that the regulation won't go into effect until 2014. So there's plenty of time to get some tax-free shopping done still.

The deal also promises to add 2,000 full-time jobs in the Volunteer State at new distribution centers thanks to a $350 million investment from Amazon. Locations haven't been selected yet.

The issue has been a hot one with merchants (online and offline) and consumers alike. From the Amazon point-of-view, not charging sales taxes offers a competitive edge on top of already bargain prices. In weak economy, this has proven especially enticing and helpful to consumers nationwide.

However, opponents to Amazon argued that it hurt small business owners who are required by law to pay sales taxes but sell the exact same products seen on the online megastore’s website.

South Carolina well as California recently have invoked similar mandates. However, the sales tax requirement will become effective much sooner in the Golden State as that bill does not require online merchants to collect sales taxes until September 15, 2012.

Related:

Topics: Banking, Amazon, Government, Government : US

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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