LANSING – The Michigan Retailers Association on Monday called on Treasurer Andy Dillon to send a bill to online mogul Amazon for sales tax owed to the state, asserting it has a physical presence and therefore, by law, must require its customers pay sales tax.
“Because Amazon has a physical presence in Michigan it has sufficient nexus with the state and should be collecting sales tax for Michigan-based online purchases on its website,” James Hallan, MRA president and CEO, said in a statement. “We urge Treasury…to send a bill to Amazon for sales tax owed.”
The call to action comes about a week after online reports rumored Amazon may be setting up a software development center in Detroit and aid in same-day deliveries.
The Department of Treasury was not immediately available for comment.
The MRA points to Amazon acquiring Grand Haven-based Brilliance Audio in 2007 to make its case, noting that the audio company could be considered a wholly owned subsidiary of Amazon. Similarly, state corporate filings have shown that Brilliance Audio’s officers and directors all list Amazon’s corporate address in Seattle, Washington, the association said.
Traditional retailers have long felt a competitive disadvantage to Internet companies like Amazon that offer the same goods, often with higher quantities, and giving customers another place to price compare before making a final purchase.
The MRA has called upon the Legislature to do something about the matter, but to little avail as HB 5004 and HB 5005 remain in the House Tax Policy Committee. Governor Rick Snyder in May also urged the U.S. Senate to pass a federal law allowing states to collect sales tax from online and catalog retailers.
“Amazon has avoided collecting taxes on its Michigan sales for years,” Hallan said. “That harms Michigan’s economy, is unfair to Michigan-based job providers and must stop. Other states have compelled Amazon to start paying taxes and Michigan must do the same.”
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