Amazon Wants Tennessee Sales To Stay Tax-Free

Tennessee customers of Amazon.com won’t be charged sales tax, even though the Internet retail giant is building two 1-million-square-foot distribution centers in the state, if the company has its way.

That would be in line with the company’s practice in six of the nine states where it operates distribution centers, the Seattle Times reports:

The company argues that, because the facilities are separate legal entities, they do not give the e-tailer a physical presence. …

Officials for Tennessee’s revenue and economic-development departments declined to comment, citing a long-standing policy of not divulging tax information about a particular business. Amazon, which rarely talks about behind-the-scenes business practices, did not answer questions about its sales-tax plan for Tennessee.

Amazon will employ 1,400 full-time and another 2,000 people seasonally “once the centers are fully ramped up in three years,” the Chattanooga Times Free-Press reported last month. The centers amount to a $139 million investment.

The newspaper has also reported on Gov. Bill Haslam’s friendly stance toward Amazon:

(Haslam said) that untaxed online sales are a growing problem for states such as Tennessee.

“I do think this is something we need to look at long term, but I do not think it needs to interfere with our recruiting of Amazon to Tennessee,” he said. “That’s a huge priority for us.”

Amazon is getting the Hamilton County site free and is getting significant tax breaks on both the Hamilton and Bradley sites, the Chattanooga Times Free-Press reported. The state is offering job tax credits and employee training assistance.