Starting Saturday Amazon will begin collecting sales tax from California customers. This move will allow the e-commerce giant to put up distribution centers in the state.
The “Amazon Tax” mandates that online retailers pay sales tax on transactions made in the state of California.
Opponents have argued this move will cost the state jobs and say it’s bad for business.
A 1992 Supreme Court ruling stated that retailers must have a physical presence in the state in order to be subject to a state imposed online sales tax. The new California law requires that any company with a nexus, or physical presence in the state, to pay the tax.
Proponents say that the tax will bring the state $200-300 million in revenue a year.