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No more tax-free shopping on Amazon


The party is over for shoppers that enjoyed tax-free online shopping — on Amazon, anyway.

Starting on April 1, Amazon will collect sales tax from all states that have a tax levy. Only the five states that do not have a state sales tax — Alaska, Delaware, Oregon, Montana and New Hampshire — will remain exempt.

In reality, tax-free shopping at Amazon has been in a slow state of decline for some time. The online giant has been continually adding new states to its list of jurisdictions that collect sales tax. On April 1, the final four holdouts — Hawaii, Idaho, Maine, and New Mexico—will be added to the list, meaning that shoppers will be paying taxes in the 45 states with states sales taxes.

Tax will be applied to items sold on Amazon, as well as subsidiaries. Gift card purchases are not subject to sales tax, but orders paid for with gift cards may be subject to tax, according to Amazon’s website.

Forbesreported that the decision to charge sales tax falls under the ruling of a 1992 Supreme Court case, Quill Corp. v. North Dakota, that deemed online and catalog retailers couldn’t collect sales taxes unless they had a physical presence where the buyer is located. As Amazon, and other online retailers, expand their breadth however, these companies can justify collecting taxes.
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