Texas Two-Step—One Step Forward, One Step Back

Comments (0) Finance and Money

After handing Amazon a bill for back-sales taxes owed, Texas lawmakers are now taking a step back. Although the bill is not explicitly written for Amazon, the American-Statesman states that critics called the action a “Hail Mary pass” for “Amazon in its dispute with Texas over whether it should have to collect sales taxes on Texas transactions.”

The bill, SB1, proposes that “any retailer able to create 5,000 jobs and invest $300 million over the next three years” would be exempt from collecting and remitting sales taxes for 4 ½ years. They would not, however, be exempt from paying property or franchise taxes. 

Focusing on distribution and warehousing, a new job is defined as one that “is created at the time a new distribution center is initially staffed.” And, similar to the South Carolina agreement, the company would be responsible for providing a comprehensive health plan to all employees.

Opinions are mixed.  Some say that the additional revenues generated would far exceed the foregone sales taxes and others say this will still put existing brick and mortar stores at risk. Yet others indicate that these jobs are questionable. According to the American-Statesman, Dick Lavine, of the Center for Public Policy Priorities feels “…what we’re looking for is people who write books, not people who sell books and move them around. Warehouse jobs are not the way to build a 21st century economy.”

About the author: Susan McLain is a writer, business analyst, blogger, marketing manager and mother of 3 grown (and growing) children. She works as a marketing manager and content specialist for Avalara, a sales and use tax compliance Software-as-a-Service company on Bainbridge Island, Washington. She is also a doTERRA essential oils independent consultant and enjoys the great Pacific Northwest with her family.

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