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South Carolina says Amazon will cost it $500 million in sales tax

Amazon CEO Jeff Bezos. Photo: Ted S. Warren / AP

Amazon will cost the State of South Carolina $500 million in sales tax over the next five years, the state's tax authority said in a motion filed this week, CNBC reports.

Why it matters: This is yet another example of states getting serious in their effort to collect sales taxes on cross-state e-commerce transactions. The failure to do so is costing states more than $1 billion per year and contributing to persistent state and local budget constraints even as economic growth accelerates.