(By Balachander) Amazon.com Inc. (NASDAQ: AMZN) has agreed to collect sales tax on Massachusetts purchases effective November 2013, Governor Deval Patrick said.
On Tuesday, Patrick announced that Seattle-based Amazon will collect and remit sales tax in Massachusetts starting next fall.
Massachusetts and Amazon also agreed to work together toward enactment of federal legislation to resolve the sales tax issue by creating an equitable and simple framework for collecting sales taxes, Patrick said.
"Federal legislation is the only way to level the playing field for all sellers, the only way for states to obtain more than a fraction of the sales tax revenue that is already owed, and the only way to fully protect states' rights," said Paul Misener, Amazon vice president of global public policy.
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Amazon also plans to create hundreds of high tech jobs in Massachusetts in coming years.
The Massachusetts Main Street Fairness Coalition, meanwhile, has been asking Patrick to take action to force Amazon to collect sales tax for most of the year.
"Once again, Massachusetts is taking action on an important issue ahead of our leaders in Washington," said Salem Mayor Kimberley Driscoll, Co-Chair of the Massachusetts Main Street Fairness Coalition, while supporting the agreement. "In the age of the smart phone, sales taxes should be applied the same for purchases whether made on Main Street or online."
AMZN shares inched 0.01 percent higher to trade at $250.71 on Wednesday.