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Amazon seeks to avoid collecting sales taxes from California consumers by cutting ties to affiliates in California who steer business to its site.
By Marc Lifsher and Andrea Chang, Los Angeles Times
July 1, 2011
Reporting from Sacramento and Los Angeles—
Saying it won't force California customers to pay sales tax on their Internet purchases, Amazon.com is severing ties with 10,000 small businesses and individuals here who funnel shoppers to the online bazaar through their websites.
The defiant action came hours after Gov. Jerry Brown signed legislation that would have required Amazon
Amazon’s CEO Jeff Bezos has said that it is protected in the U.S. constitution’s prohibition of state’s interference in interstate commerce -
And in the U.S., the Constitution prohibits states from interfering in interstate commerce. And there was a Supreme Court case decades ago that clarified that businesses — it was mail-order at that time because the Internet did not exist — that mail-order companies could not be required to collect sales tax in states where they didn’t have what’s called “nexus.”
Amazon.com is severing ties with 10,000 small businesses and individuals here who funnel shoppers to the online bazaar through their websites