Why Is Amazon Going To The Supreme Court Over Sales Taxes?
Oh, Amazon (NASDAQ:AMZN), we've missed this side of you. For the past two years, Amazon has been a vocal advocate of a federal law making online sales taxes legal. But the e-commerce giant still had a lawsuit working its way through New York courts over the question of whether its "associates"—independent websites that get a commission for referring business to Amazon—qualify as a physical presence in the state, which would force Amazon to collect sales tax. On Aug. 23, Amazon finally got the chance to appeal its losing-every-time-so-far case to the U.S. Supreme Court.
We figured Amazon would do that—otherwise the e-tailer would have stopped paying those lawyers two years ago, right?—but it seems to have baffled some observers. Look, it's like this: Amazon wants online sales taxes for everyone, since it's already collecting in some states. That's what a federal law would do. Amazon doesn't want state-by-state "Amazon taxes" that are custom-designed just for the big dog and probably won't be enforced against anyone else. Simple enough? Besides, a Supreme Court win would give Amazon that much more leverage for tax relief with new warehouses until that federal law finally passes—and at the rate it's (not) moving through Congress, that could be decades.