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Originally published Thursday, March 3, 2011 at 5:08 PM

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Amazon should pay sales taxes to California and Texas

The Seattle Times editorial board criticizes Amazon Inc. for trying to avoid charging sales tax to its customers in California.

AMAZON.COM Inc. now threatens to cut off its California associates to avoid paying California sales tax on the company's sales to customers there. This follows Amazon's announcement that it is closing a distribution center in Texas rather than pay Texas sales tax on its sales to people in Texas.

The Seattle Times wishes success to Amazon, seeing that it is in our state and even in our very neighborhood. But we do not approve it continuing to dodge this tax. Amazon is taking an irresponsible position.

Amazon is essentially a mail-order retailer. These have been around for more than a century. When they sold across state lines they did not charge sales tax because no federal law made them, and because of the paperwork in calculating the tax.

All that was fine as long as sales taxes were tiny and mail order was not a significant competitor to free-standing stores. And that has changed. Amazon is a giant. It has helped drive hundreds, and maybe thousands, of bookstores out of business. The Internet retail industry already has a cost-of-real-estate advantage over free-standing stores. It should not have a tax advantage as well. On its face, such an advantage is wrong.

We have said it before and will say it again: Amazon will have to pay. Someone will twist this company's arm. Maybe it will be California, maybe it will be Texas, maybe it will be all the states and maybe it will be the federal government. It will happen, and Amazon will survive it.

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