Pennsylvania to tax Amazon customers

Starting Sept. 1, Amazon customers will have to dig deeper into their pockets.

The Pennsylvania state government will start collecting sales taxes from online retailers that have physical sites in the state, including Amazon.

In a decision last December, the tax collection was initially scheduled to begin Feb. 1, but was recently postponed to the fall. This is due to requests from online retailers for more time to modify their software and systems to adjust to the change.

A 1992 U.S. Supreme Court decision ruled that internet retailers cannot be forced to pay sales tax, unless they have a physical presence such as stores, offices or warehouses. Amazon has not paid this tax since the Supreme Court ruling, but will be forced to do so beginning this fall.

The online retailer owns a large distribution site and multiple warehouses in Pennsylvania. Amazon representatives did not respond to multiple requests for an interview.

Pennsylvania state government claimed it would have earned $345 million in tax revenue last year if Amazon and other online retailers had to pay the tax, according to The Journal of Commerce.

Michael Row, the owner of the Penn Book Center on 34th Street, is glad about the change. “It’s unbelievable that Amazon had such a free ride for so long and nobody seemed to care. I think that’ll be a big help to bookstores since we can’t compete with Amazon’s prices,” he said. “It’s a very tough business. This will help put us on a level playing field.”

However, Engineering senior Chinmay Paranjape, a loyal customer of Amazon, is upset with the new regulations.

“As a consumer, this is very annoying because one of my favorite things about Amazon is that what you see is what you pay — unlike other stuff, such as Southwest tickets,” he said.

Paranjape said the new tax will not keep him from shopping at the online retailer since “the tax rate is less than the amount I save by shopping on Amazon.”

“Having a tax included might make me think twice about subscribing to Amazon Prime,” College freshman Daniel Wendler said. “If eBay has it, I’ll do that instead, but this sales tax won’t stop me from shopping at Amazon since it’s still convenient and cheaper than the Penn Bookstore.”

Engineering freshman Michael Pintauro will continue to be an Amazon customer.

“Amazon’s pretty cheap, so the tax doesn’t really affect me much. I don’t mind paying an extra $2 for a $20 purchase if it’s going to help out the governor or something,” he said.

Pintauro estimates he spends between $200 and $300 a year on Amazon. “There’s a very small chance of not finding what you’re looking for.”

Pennsylvania is not the only state where customers will now have to pay a tax. Last Friday, the Virginia Senate voted to close what’s known as the “Amazon loophole,” which requires online retailers with a physical presence in Virginia to collect sales tax from customers.

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