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Calif., Amazon reach deal

Reid Butler plays with his daughter Siena, 2, after receiving online purchases from Amazon at their home in Walnut Creek, Calif. Products are flying off the shelves at Amazon warehouses across the county as Californians prepare to start paying sales taxes on online purchases.
Online sales will be taxed

SACRAMENTO, Calif. — Online retailer Amazon.com has tried to become all things to all consumers, but in California, it is about to take on a role it has fought against for years: tax collector.

The change, which takes effect this weekend, comes after years of bitter back and forth between the world’s largest online mall and the California Legislature over whether Internet retailers should have to charge sales tax. The two sides reached a deal in 2011 that included a one-year grace period set to end Saturday.

The deadline has spurred at least some consumers into impulse-buying mode, making big-ticket purchases and stocking up on essentials before the tax collection kicks in.

“Even the mailroom is laughing at me,” said Derek Daniels, 37, who has had Amazon packages delivered to his Los Angeles office every day this week. He’s loading up on household supplies like trash bags and collecting birthday and Christmas presents for his Superman-loving 2 year-old.

“We are hoping he won’t fall in love with Batman by the time November rolls around,” Daniels said.

The looming deadline prompted San Diego artist John Purlia to finally buy that Samsung flat-screen television that had been sitting in his Amazon shopping cart for months. He also picked up four CDs, an external hard drive and an oddly decorated $17.99 kitchen cutting-board — a gag gift for his sister.

“The TV was the motivating factor and the other stuff came along for the ride,” said Purlia, 52. “I know I’m going to be back at Amazon before Saturday looking to take advantage of this. It’s like the final days of a sale.”

Technically, Purlia and Daniels owe taxes on all of this: California residents are supposed to calculate their obligation and send it directly to the state. But fewer than 1 percent do, according to the Franchise Tax Board.

Lawmakers have long complained that the increasingly popular e-retailer was depriving the state of millions of dollars by refusing to charge taxes at checkout. But Amazon said it was shielded by a 1992 U.S. Supreme Court ruling that prohibits states from forcing businesses without a physical presence in the area to collect sales tax.

The e-commerce giant said it did not have a physical presence in California because it does not have warehouses or other buildings here.

Similar fights have played out in other states, with Amazon sometimes shuttering distribution centers and canceling contracts to be able to continue selling tax-free goods.

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