LOS ANGELES (CBSLA.com) — Shoppers hurried to scoop up last-minute deals on Amazon on Friday, just hours before a California sales tax took effect on all purchases from the online giant.
KNX 1070’s Pete Demetriou reports the online retailer will no longer enjoy an advantage with customers that made it among the premier online shopping destinations.
Amazon will comply with the request of the California taxing authority – which was also sent to 200 online-only businesses that take in more than $1 million annually in online sales – to put them on equal footing with brick and mortar outlets.
While some projections forecast up to $200 million in new revenue for the state, former State Senator George Runner of the state Board of Equalization warned last July that the move could cost California as much as $150 million in lost income tax on suppliers and other Amazon-related businesses who could be hardest hit by the tax.
Amazon customers had mixed reactions to the looming tax.
Steven Henderson, who describes himself as a frequent online shopper, said the news is not going over well with him.
“It’s gonna affect me a lot, I’m gonna stop shopping on there, really,” said Henderson. “Everybody’s out to get money these days and they’re not thinking of consumers.”
One woman, however, said the tax was unlikely to force her to close her Amazon account.
“Just pay it, I’m not gonna rush to save my money,” she said.
Others said they will continue to use Amazon, but may look for other companies online who are not complying with the state’s request to charge sales tax on their online products.