Amazon, Book Stores Battle Over Tax Collection

©Oleksandr Lutsenko/123RF

I just saw a story on CBS’s The Early Show about internet retailer resisting campaigns to collect sales tax for their transactions.

By not doing so, the report said, states are losing more than $11 billion in tax revenue. States are supposed to get that revenue to begin with; if you purchase online, you’re supposed to declare in your income tax return the amount of purchases you’ve made for which you haven’t paid sales tax, so you can pay at that time.

If you believe states shouldn’t force retailers like Amazon to collect those taxes at the point of purchase, you must also assume that everyone is completely honest when it comes to listing the dollar amount of purchases they’ve made over the past year. Some of us try our best to account for every dollar; but I suspect that’s not the case for most people.

At the very least, Amazon should be forced to mail state governments (and consumers) a statement accounting for every dollar spent, similar to a W-2 form, which consumers could use to pay their sales tax at tax time, and which states could use to hold them accountable.

In this economy, states shouldn’t have to lose additional revenue like that.

But then the book stores enter the fray, complaining that not collecting sales tax gives an advantage.

Sorry, book stores, but in this little battle, you might as well sit this one out.

Amazon doesn’t have an advantage because it doesn’t charge sales tax: it has an advantage because it offers a better selection at lower prices.

Those two facts alone, even if taxes are collected, give the retailer extra points over book stores.

Don’t get me wrong: I like book stores. But Amazon almost always undercuts the prices of book stores. Unless it’s a book I just have to have that night, I don’t mind waiting a couple of days if I can save 30% or more. And the majority of books I want these days — the few that I’m not ordering on a Kindle for my iPad — aren’t as likely to be found in a book store. That means a special order, which gives me this choice: ordering through the book store and waiting longer and paying more, or ordering through Amazon, paying less and getting it sooner.

That’s a contest?

Then there’s one more advantage offers: I don’t have to pay $10, $15 or even $25 a year to join some stupid book club so that I can then pay a discounted price that is still higher than what charges to begin with.

I gave up on Barnes & Noble’s discount card a few years ago when they told me that I’d have to pay $25 a year for it. Sorry, but I have no interest in paying that much more to be able to pay less. Though B&N usually has a wider selection than most other brick and mortar book stores in my area, I’ll find a book I want there, then go to Books-A-Million, where I have their lower-priced discount club membership, and search for the book there. If B-A-M doesn’t have it, I’ll order through Amazon and save, anyway.

Amazon has been around long enough that book stores could have long ago abandoned its membership fees. The fact that they haven’t diminishes their argument about Amazon being “unfair” competition.

If the stores still aren’t willing to do away with those extra membership fees, then they continue doing it to themselves.


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  2. @psalm23 The reason I use Amazon has nothing to do with laziness. I’m more than willing to take the extra effort of driving to a bookstore and searching the shelves for the book I want. I really enjoy browsing the aisles to see what I might enjoy.

    I just resent having to pay a fee to get a discount I ought to be able to get to begin with.

    And there aren’t many independent book stores around here with enough of a selection to make them worth my while.

    As for browsing, Amazon does indeed allow flipping through a selection of pages on some of the books it sells. This seems to be a function of how willing the publisher is to allow the “Look Inside” function to be operational. I have actually selected books on specifically because I was able to browse the table of contents or read the first few pages to determine whether the book might be one I’d enjoy or find useful.

  3. @psalm23 Bookstores aren’t dying because people are too lazy. They’ve made bad deals with an industry (publishing) that either can’t or won’t adapt.

    BnN wised up with the Nook.

    Borders is already in big trouble.

    Even if you are a great optimist, it’s tough to argue against three obvious points.

    1. Print sales are falling.

    2. Ebook sales are rising.

    3. 70% royalty (what an author gets on an ebook) is more than 17.5% royalty (what an author gets on a traditional deal).

    The conclusion I draw is that more authors will abandon the Big 6 Publisher except for your uber best sellers. Follow the dominoes. Fewer authors means fewer books printed, fewer books sold, and fewer choices for readers. Eventually, you’ll have to buy an ereaders just read soemthing other than a James Paterson or Stephen King.

    Independent bookstores have a real opportunity in this time to set themselves apart for customer service, and live events.

  4. My (independent) bookstore gives me nearly the same discount as Amazon for free; I just have to give them my name. Plus, whatever I want here in my hand when I need it. Unless, of course, bookstores all go out of business, which they are in danger of doing because people are lazy. Long gone are the days of browsing for hours in a bookstore, finding things serendipitously that one would never think to actively search for. This makes me very sad.

    You just can’t browse the same way on Amazon: there is no flipping through the pages, looking at the font and seeing an illustration that catches you eye, no reading 2-3 pages and getting pulled into the story. It’s why I go to bookstores. Or why I used to anyway. …sighMany are the books I’ve ordered from Amazon that have arrived only to disappoint me in their actuality. Had I been able to LOOK at the book properly, I wouldn’t have spent the money/wasted my time.Hate hate hate Books a Million; for me, it’s the Wal-Mart of the book world.

  5. Did you mean to say sales tax instead of income tax? It wouldn’t make any sense to pay income tax on something you bought as that’s spending and clearly not income.

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Patrick is a Christian with more than 30 years experience in professional writing, producing and marketing. His professional background also includes social media, reporting for broadcast television and the web, directing, videography and photography. He enjoys getting to know people over coffee and spending time with his dog.