Do You Pay Sales Tax for Kindle Books?
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Internet sales tax and more Internet regulation are on the horizon. As much as experts want to believe that the Internet could stay as it is today, the financial struggles of the U.S. government and the states could force the lawmakers’ hands and make them open to regulating the Internet. Amazon.com is one of the best e-tailers around due to its large selection of items and its low prices. Most Amazon customers do not pay sales tax to Amazon. That means they have a better chance of finding lower prices on Amazon than on websites that do collect sales tax. There is no question that Amazon has some of the lowest prices around when it comes to e-books. That is going to change with the agreements that Amazon struck with a few top publishers (the agency model debacle):
Several publishers have recently changed the nature of their relationship with Amazon, moving to a business model whereby the publisher, not Amazon, is the seller of record for their books. Kindle books sold under this model are subject to sales tax based on the publisher’s state tax reporting obligations and the taxability of digital books in those states. Books where the publisher is the seller of record say “This price was set by the publisher.” Nothing has changed with respect to sales taxes on Kindle books where Amazon is the seller of record.
We are no tax experts, but in many states buyers are supposed to pay sales taxes for their online purchases even if the e-tailers do not charge it. So this announcement does not change anything in that regard. What it does is increase e-book prices a bit more for some customers. That’s another reason why some Kindle customers are not happy with the agency model adopted by a few top publishers on Amazon.
Paying taxes on things we buy is not anything new. We have all done it in the past, and there is no reason to believe we won’t have to do it in the future. But the addition of sales tax for Kindle books is not going to make the already disgruntled Kindle customers happy:
I will not be purchasing books that have this restriction. Thanks for the heads up.
Says G. K. Thompson. Not the only customer complaining about this development. Amazon is the easy target here. The company could be forced to collect sales tax on all items in the near future. Will Kindle owners boycott Amazon over this? Some probably will. But, what will they do when the Congress takes up the Internet tax legislation?
Have you been charged sales tax for e-books on Amazon?
