Dozens of Amazon-labeled packages, filled with discounted textbooks and dorm essentials stack up daily in the ORU Post O ce.
Amazon is an incredibly popular go-to for col- lege students looking for cheap, tax-free items. However, starting on March 1, Amazon will start charging a sales tax for Oklahoma residents that will be remitted in April.
“That will really help our state,” said Oklahoma Gov. Mary Fallin during a legislative forum sponsored by e Associated Press on Feb 2. “But in particular it will make a huge difference to our cities and our towns and our counties who will now start receiving that sales tax payment.”
Why start taxing now?
Online shopping has been estimated to put the state in a $300 million dollar de cit in sales tax collections according to state officials. Until now, an Oklahoma Tax Commission act passed in 1992 has prevented the state from mandating a tax collection on out-of-state retailers.
Amazon has no distribution centers or o ces in Oklahoma; therefore, sales tax on purchases has never been a concern for local residents. e motive behind Amazon’s permissive decision is unknown, as the company could not be reached for comment. Despite this, Fallin announced that Amazon.com recently agreed to voluntarily make Oklahoma the 40th state in which sales tax is charged on their orders.
What are the benefits?
It has been an ongoing concern that local Oklahoma retailers are at a disadvantage when it comes to out-of-state online companies such as Amazon. This enactment is expected to provide local retailers with a more equitable chance in competition against the company.
“It is a model that I hope and expect many other internet retailers to follow. I appreciate the stance Amazon has taken to help level the playing eld for all retailers, which was the true purpose of the Oklahoma Retail Protection Act,” Rep. Chad Caldwell said in a written statement posted by the Oklahoma House of Representatives last May.
It is also anticipated to bring in tens of millions of dollars annually for state projects such as paving roads, education and healthcare services.
What are the disadvantages?
This agreement means that consumers will consequently have to pay 4.5% more for their online orders than in the past. Although local governments will benefit by receiving the sales tax collections beginning in May, it is not expected that this law will a ect Oklahoma’s current year’s scal budget hole.
But why stop there?
Fallin simultaneously announced plans to take measures to receive more tax money for the state by urging Congress to pass a federal law that requires all out-of-state retailers to collect and remit a sales tax, according to Oklahoma Watch.