Traditional brick-and-mortar retailers, have won a major battle. Amazon has agreed to collect and pay sales tax on purchases made to Virginians.
Governor Bob McDonnell announced that an agreement has been reached between his office, Amazon, several members of the General Assembly,and brick and mortar retailers, to close the tax loophole.
The agreement negotiated with Amazon requires certain online retailers to collect the sales and use tax in the same manner as a bricks and mortar retailer.
Amazon has faced major criticism from Virginia and federal officials for not paying state sales taxes. Other states have recently passed laws requiring the payments. Governor McDonnell had announced in December that Amazon would be opening two fulfillment centers in Virginia, investing a total of $135 million and creating more than 1,350 jobs.
McDonnell said the new tax legislation will “help to ensure that online retailers with a physical presence in Virginia are treated the same as traditional brick and mortar retailers who are already required to collect and remit existing sales taxes on goods sold in the Commonwealth."
Amazon’s Vice President of Global Policy, Paul Misener, added, "Amazon is very grateful to Governor McDonnell for his focus on Virginia jobs and for his efforts to work with other governors toward national resolution of the sales tax issue this year."
Rob Shinn with the Virginia Alliance for Main Street Fairness representing a coalition of hundreds of Virginia retailers noted, "We are extremely pleased with the agreement. Today’s announcement is a significant step toward tax fairness for the retail community by ensuring the same rules apply to all retailers doing business in Virginia."