Online retailer Amazon said today it will collect sales tax in Massachusetts starting next fall, and will work together with Gov. Deval Patrick toward enacting federal legislation to resolve the sales tax issue.
The agreement will take effect on Nov. 1, 2013.
"We are thankful Amazon was willing to come to the table and we will continue our conversations with them about creating jobs here," Patrick said today. "This agreement is a win for all sides, and I am pleased it promises to generate millions in long-term revenue for the Commonwealth."
The Massachusetts Main Street Fairness Coalition, which has been urging Patrick to take action to force Amazon to collect sales tax for most of the year, said it supported the agreement, and will now focus its efforts on action in Congress to "level the playing field" between all online sellers and traditional retailers.
"In the age of the smart phone, sales taxes should be applied the same for purchases whether made on Main Street or online. We are grateful to Governor Patrick for his leadership in leveling the playing field between our Main Street businesses and Amazon," the coalition said.
Jon Hurst, president of the Retailers Association of Massachusetts, said members would be "grateful and relieved" to know they would not face another holiday sales season with a 6.25 percent tax disparity with Amazon.
"Unfair sales tax application is an antiquated policy that favors out-of-state businesses over local employers and it has to end," Hurst said. "The announcement today is an important and significant step toward realizing that ultimate goal."
Amazon has begun collecting sales taxes in other states where it has a physical presence and the coalition has been pressing the Patrick administration to demand similar treatment since the online sales giant set up an office in Cambridge earlier this year.
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