Amazon purchased a robotics company in North Reading earlier this year, and opened a research office in Kendall Square in Cambridge, establishing what some officials suggested was the “brick and mortar” nexus necessary for the state to force the company to collect the taxes from its online shoppers.
The related business interests, however, are unlike the distribution facilities directly related to its online retail operations that other states have used to force agreements, Gonzalez said. More than a dozen states have reached deals with Amazon over tax collections, including Nevada, New Jersey, Texas, California and Pennsylvania.
Though some of those states struck direct agreements with Amazon to build new facilities or create jobs, Massachusetts officials said Amazon only committed to growing here in the future in its related business ventures. Gonzalez said through the negotiation process, state officials built a good relationship with Amazon and believe Amazon sees Massachusetts as a “growth area” and plans to “ramp up” its presence.
“We look forward to creating hundreds of high-tech jobs in Massachusetts and continuing to work with Gov. Patrick, state leaders, retailers and Congress to pass federal legislation permitting interstate sales tax collection. Federal legislation is the only way to level the playing field for all sellers, the only way for states to obtain more than a fraction of the sales tax revenue that is already owed and the only way to fully protect states’ rights,” said Paul Misener, Amazon vice president of global public policy.
According to the Alliance for Main Street Fairness, Massachusetts has lost out on $600 million in sales tax collections from e-commerce since 2007, including $132 million in 2012 and $116.8 in 2011. The state does have a “use-tax” provision in the tax code requiring residents to record and pay sales taxes on purchases made out-of-state or online, but enforcement is not highly successful.