Dec 15, 2017 - Future

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.

  • Though Amazon now collects sales tax on all goods it sells from its own inventory, it does not necessarily collect tax for third-party affiliate sales.
  • The failure of Amazon or these third parties to collect sales tax cost South Carolina $57 million last year, the state says. Amazon didn't immediately respond to a request for comment.

What the law says: As it stands, retailers aren't required to collect sales taxes on goods sold in states where they don't have a physical presence, though customers still technically owe (but rarely pay) these duties.

What's next: States are challenging this standard in jurisdictions around the country, with the most closely watched case being a South Dakota petition filed earlier this month to the Supreme Court, asking it to review whether it can constitutionally require retailers in other states to collect South Dakota sales tax.

What's next

Honoring Kobe Bryant: Sports stars, politicians and celebrities mourn NBA great

Kobe Bryant on court for the Los Angeles Lakers during the Sprite Slam Dunk Contest on All-Star Saturday Night, part of 2010 NBA All-Star Weekend at American Airlines Center in Dallas in February 2010. Photo: Jed Jacobsohn/Getty Images

Sports stars, politicians and celebrities paid tribute to NBA legend Kobe Bryant, who was killed in a California helicopter crash alongside his 13-year-old daughter, Gianna, and seven others on Saturday. He was 41.

What they're saying: Lakers great Shaquille O'Neal said in an Instagram post of his former teammate, "There's no words to express the pain I'm going through now with this tragic and sad moment of losing my friend, my brother, my partner in winning championships, my dude and my homie. I love you brother and you will be missed."

Bolton alleges in book that Trump tied Ukraine aid to investigations

Photo: Alex Wong/Getty Images

President Trump's former national security adviser John Bolton alleges in his forthcoming book that the president explicitly told him "he wanted to continue freezing $391 million in security assistance to Ukraine until officials there helped with investigations into Democrats including the Bidens," the New York Times first reported.

Why this matters: The revelations present a dramatic 11th hour turn in Trump's Senate impeachment trial. They directly contradict Trump's claim that he never tied the hold-up of Ukrainian aid to his demands for investigations into his political opponent Joe Biden.

Impeachment: Then & now

Illustration: Sarah Grillo/Axios

We are living in a measurably different political and media landscape than when the Senate acquitted President Bill Clinton of impeachment charges in 1999.

The big picture: These dynamics are setting the pace as President Trump’s legal team speeds through arguments to seek a fast acquittal.