Amazon will no longer be able to avoid taxation in the US state of Indiana after 2014, with the move expected to bring in an extra $25 million for the state.
The online retail giant has often been the target of criticism for exploiting a tax loophole that allows mail order companies outside of certain states to not charge sales tax to its customers. That of course allows Amazon to keep its prices very low; giving it what many would consider an unfair advantage over standard retail outlets.
While the retailer has publicly stated in the past that it's not actively avoiding taxation, it previously closed facilities and warehouses in states that did look to change the law so it would be taxed. However, Indiaina is an interesting case as Amazon previously built large storage warehouses on the basis that it wouldn't be taxed.
The announcement for the change in law was made by Governor Mitch Daniels, while standing next to Amazon's vice president of global public policy, Paul Misener. As part of it Daniels praised Amazon for its "willingness to work with us."
However none of this has come about via goodwill from the state or the retail giant. The Indiana based Simon Property Group, the nation's largest mall owner, threatened to take the state to court over its preferential treatment of Amazon. Perhaps this was more pressure than the local government wanted as it quickly entered talks with Amazon, eventually coming to an agreement that as of 2014, the online retail site would too begin charging sales tax.
"As an Indiana-headquartered company that employs thousands of Hoosiers, Simon is pleased that the state took this action which benefits Main Street retailers and hundreds of thousands of retail employees in our state that deserve to be on a level playing field with online retailers," reads the statement from Simon, posted on The Star Press.