Business and Economy Tax and Budget Transparency and Elections

Amazon Compromise Mirrors McNally’s ‘Grace Period’ Idea

Sen. Randy McNally, chairman of the Senate finance committee, says retailers still upset with Amazon’s tax agreement with the state aren’t likely to get a better deal than the one negotiated by the Haslam administration.

McNally, R-Oak Ridge, one of the key figures in trying to have the company start collecting sales tax from Tennesseans, said further action in opposition to the deal is up to those other retailers, but he said, “Certainly, if I was asked to give them advice, I would tell them that this is far and away the best deal they could get.”

Gov. Bill Haslam announced Thursday that the state has a new deal with Amazon, in which the online retailer will begin collecting sales taxes in 2014, while Amazon commits to increasing its job total in the state to 3,500 positions on an investment of up to $350 million.

McNally said he hopes this will settle the matter of Amazon’s tax status and suggests that the overall online sales tax issue should go through the courts to be resolved nationally, because he believes Congress is unlikely to act to bring uniformity to the collection of state sales taxes.

Recent reports say Amazon has its sights on locations in Rutherford and Wilson counties, as it seeks to grow its presence in Middle Tennessee, the latest development in a story that began last fall when former Gov. Phil Bredesen gave Amazon the ability to avoid collecting taxes in exchange for building distribution centers in Hamilton and Bradley counties. Haslam’s administration and Amazon negotiated the new arrangement.

The retail group Alliance for Main Street Fairness immediately objected to the Haslam agreement, saying 2014 is too long to wait, noting in particular that the deal gives Amazon three holiday shopping seasons before it has to collect. The brick-and-mortar retailers continued their campaign over the weekend with newspaper advertising objecting to the deal, saying California got an agreement for Amazon to collect beginning in 2012 and that the same should apply in Tennessee.

Haslam said he will submit the new deal in the form of legislation, to be considered when the General Assembly convenes in January. McNally and Rep. Charles Sargent, R-Franklin, chairman of the House finance committee, had initiated legislation this year and twice submitted requests for opinions from state Attorney General Robert Cooper on the matter. Cooper’s most recent opinion said no retailer can escape responsibility to collect the tax, although he said the commissioner of Revenue has wide discretion.

Haslam saw McNally at the funeral in Madisonville Oct. 2 for Lance Cpl. Frankie Watson, a Marine killed in Afghanistan. The governor told McNally that day he wanted to talk to him a couple of days later about Amazon. McNally was scheduled for surgery in Oak Ridge that Tuesday, so Haslam filled him in then on the plan. The surgery was why McNally did not attend the press conference at the Capitol on Thursday.

Haslam told McNally of the two-year forgiveness period on the tax collections and that after that the playing field would be level. McNally had suggested a two-year “grace period” as a possible solution to the matter in July. McNally said Friday he was taking no credit for the final agreement and that Haslam had not suggested that McNally’s idea was the catalyst for the deal. Neither did McNally ask if his idea had been the foundation of the arrangement.

“It just seemed to be in the best interest of the state,” McNally said.

One of the key elements of Amazon’s strategy appears to be centered on geographical factors.

The Nashville Business Journal posted a story online Friday morning saying Amazon will choose a site in Murfreesboro off Joe B. Jackson Boulevard for a facility involving 1,100 jobs and a capital investment of $87.5 million. Another facility, the Business Journal reported, would be in Lebanon, near Interstate 840, that would create up to 450 full-time jobs, a $51.5 million investment.

“I know they’re looking at sites that are close to Interstates,” Sargent said Saturday. “The same with Lebanon. They can get on Interstate 40, they can get on Interstate 840 and go all the way across to I-65 and I-24.

“Transportation is a big thing to them.”

Access to multiple Interstate highways, waterways and other modes of transportation, especially the presence of FedEx in Memphis, make Tennessee an attractive location for many different companies, state officials say.

In a recent interview with TNReport, Economic and Community Development Commissioner Bill Hagerty said logistics, one of the six major clusters of businesses the administration has identified in the state, is the premier cluster, even ahead of auto manufacturing and health care.

“You’ll see a theme running through all the clusters,” Hagerty said. “You’d be surprised. Even with health care, if you look at all the medical device operations around Memphis, they’re there because FedEx is there.

“An orthopedic firm can have their products on a plane and in a surgical field tomorrow. So they can inventory all these expensive things there, make them to order if they need to, and have it in the operating room the next day.”

Neither McNally, Sargent nor Sen. Bo Watson, R-Hixson, Senate speaker pro tempore, said they were aware Friday of sites being chosen by Amazon. Sargent said he got the chance for the first time Thursday to sit down and talk to Paul Misener, vice president for global public policy for Amazon, after a press conference at the Capitol on Thursday announcing the deal.

“They’re very excited about it,” Sargent said.

The Business Journal reported the Rutherford Industrial Development Board approved a 20-year tax break for Amazon. The Tennessean in Nashville reported the same tax break for the potential site in La Vergne or Murfreesboro, as well as a 15-year tax break for Amazon for a second, smaller facility in Rutherford County.

The Tennessean also reported incentives in Wilson County that include a $3.8-million tax break offered by the county and a break of $439,000 to $550,000 in property tax breaks by the city of Lebanon, with Amazon agreeing to make an annual payment of $28,900. State officials have said there are no state incentives in their deal with Amazon beyond standard incentives for job training and infrastructure.

Rep. Joe Carr, R-Lascassas, emphasized Friday that the deal was not done and that reports he was hearing of were premature.

“The last thing you want to hear is reports out of Rutherford County that Rutherford County got the deal and two weeks later learn that we didn’t get the deal,” Carr said.

Carr confirmed, however, that Rutherford County is very much in the running for sites to be chosen.

McNally, who had issued a formal statement on Friday expressing his support of the Haslam deal, seemed pleased with the outcome but voiced continued concern about the bigger picture.

“I think, hopefully, this would settle the issue with Amazon,” McNally said. “Now, long-term there is an enormous issue about out-of-state retailers that don’t have a presence in Tennessee that aren’t collecting the sales tax and how the states can address that.

“It’s been my theory that they ought to try to go back through the courts again. That probably would be the best option, because I doubt Congress would touch this with a 10-foot pole.”

The issue has been litigated most notably with a 1992 case involving Quill Corp., a mail-order company that made catalog sales. The North Dakota Supreme Court ruled there was sufficient presence, or nexus, of Quill in North Dakota that required Quill to collect the sales tax there. But the U.S. Supreme Court overruled the state court, saying the case did not represent sufficient nexus as it related to the commerce clause in the U.S. Constitution.

For years, states have turned an eye to Congress to settle the matter legislatively, but many observers, including McNally, see Congress as unlikely to get involved in an issue that would increase tax collections for the states. Haslam called again Thursday for a national solution.

Business and Economy Featured News Tax and Budget

New Amazon Deal Praised As Improvement On Deal, Not Backtracking

When all was said and done in the announcement Thursday that Amazon will collect sales taxes in Tennessee beginning in 2014, the state was in a different place from its original agreement with the online sales giant.

The original plan had been that Tennessee would get hundreds of jobs from two distribution centers in the Chattanooga area, so in return the state would let Amazon avoid collecting sales taxes on purchases. The deal was subject to debate almost from the time it became known.

Now, with a commitment that will bring the total number of Amazon jobs to 3,500 in the state, Amazon will have to collect sales taxes, although it is not soon enough for some critics of the deal.

So by negotiating a new deal with the company, taxes included, does that mean that in the big picture Tennessee went back on its word?

“No, absolutely not,” said Speaker of the House Beth Harwell, pointing to the efforts of Gov. Bill Haslam and Commissioner of Revenue Richard Roberts. “I’m proud the governor and the commissioner were able to sit down with Amazon and work out an arrangement that is pleasing not only to Amazon but also to the taxpayers of this state.

“I think it is a fair way to bring a large number of jobs to the state of Tennessee.”

Lt. Gov. Ron Ramsey, R-Blountville, called the announcement Thursday a “big win for unified Republican government on the jobs front.”

“The governor has negotiated a deal that promotes economic growth and jobs creation while protecting the interests of brick-and-mortar businesses who are the backbone of our economy,” Ramsey said in a formal statement.

“This is a good solution for the state of Tennessee, and I commend the governor for resolving this.”

Deputy Gov. Claude Ramsey said the deal simply means an improvement on what the state had before.

“It didn’t go back on its word. It just worked out a better deal,” Claude Ramsey said.

The deputy governor was asked if the new deal would in any way be detrimental to future negotiations with other companies.

“No, sir,” he said. “Because I think it shows that there is a solution. We worked to a solution.”

The original deal was struck by a Democratic governor, Phil Bredesen, who told Haslam of his plans and the reasons behind them: Get the jobs and collect no taxes, or lose the jobs and collect no taxes. Haslam, a Republican and newly elected when Bredesen told him of the deal, told Bredesen he would honor the agreement.

But ultimately, the Haslam administration engaged Amazon in an entirely new discussion. The result was an arrangement where Amazon not only would be collecting the sales tax but would be adding jobs to the point its total commitment had grown to 3,500 jobs and $350 million.

The entire scenario involved a Democratic administration sacrificing a substantial amount of revenue and a Republican administration doing everything it could to collect owed taxes — shifts from the stereotypical depictions of Democrats as tax-and-spenders and Republicans as advocates of revenue reduction.

Republicans did so in the name of tax fairness, yet other retailers were not satisfied that Amazon still gets until 2014 to start collecting and remitting.

In the Legislature, it was a Republican duo, Sen. Randy McNally of Oak Ridge and Rep. Charles Sargent of Franklin, who had contemplated legislation to force the tax collections.

Sen. Bo Watson, R-Hixson, speaker pro tem, said the new deal does not go against the original deal.

“I don’t think you can say it’s anything against the original agreement,” Watson said. “I think this is a continuation of dialogue that’s been going on between the administration and Amazon since the original agreement was discussed.

“All along, as this whole debate has been occurring, many of us, me being one, have been saying that conversations have been continuing, and this is just a continuation of that conversation.”

Democrats held a press conference Thursday, calling for $15 million toward a jobs plan. When they were asked about the Amazon deal, House Democratic Leader Craig Fitzhugh did what Haslam did and emphasized the part of the deal that was about jobs, not taxes.

“I think the primary focus is on the jobs, the jobs that the Bredesen administration brought here through Amazon, and through an agreement that has to do with the revenue, that there’s going to be another 2,000 jobs on top of that,” Fitzhugh said.

“So I think that’s the key thing we have to focus on in these times, which as everybody has said, is jobs.”

Mike Turner, the House Democratic Caucus chairman, said, “The law is already on the books. You’re supposed to be paying that tax as it is now.

“There’s no new taxes being added to the books because of what we’re doing.”

Andrea Zelinski contributed to this report.

Press Releases

Prominent TN Furniture Retailer says Amazon Tax Deal Bad for Homegrown Business

Press Release from the Alliance for Main Street Fairness, Aug 25, 2011:

One Of Tennessee’s Oldest Businesses Calls For Change At State & Federal Level

Lebanon, TN – The owners of one of Tennessee’s oldest businesses said today that the deal the state struck to get to locate distribution centers in the state is wrong and bad for local employers. DT McCall & Sons, which sells furniture, electronics, appliances, guns and more, operates stores in Carthage, Cookeville, Lafayette and Lebanon. They also sell products online and collect the sales tax.

Lebanon is one of the Tennessee locations where Amazon will be opening a distribution center. Under the deal brokered by then-Governor Phil Bredesen, Amazon doesn’t have to collect and remit sales taxes in the Volunteer State. DT McCall & Sons wants both state and Federal action to fix the inequities in collecting state sales taxes so Tennessee employers are not operating at a competitive disadvantage.

“Our company welcomes Amazon and their investment to Tennessee; however, you’d like to think that after 115 years of paying and collecting state taxes and employing Tennesseans, the state wouldn’t cut a deal to give your competition an unfair price advantage,” said AJ McCall, one of the owners of DT McCall & Sons. “But that is exactly what they’ve done. They’ve used their power to put my company at risk and even helped locate them in the same town.”

Current Governor Bill Haslam has said publicly that Congress needs to pass a bill setting national policy concerning the issue so every state handles online sales taxes collection in the same manner. A study by the University of Tennessee concluded the state is losing $400 million dollars a year from uncollected sales taxes over the Internet.

McCall went on to say, “This is actually one of those cases where Congress can do something to help employers. I just hope they act soon, before more local businesses layoff employees or close up shop altogether. Those losses will grow because for every job Amazon creates, I believe we will lose two jobs at existing businesses. This deal is a lose-lose for every retailer in the state.”

McCall’s is far from alone in their view. The Alliance for Main Street Fairness (AMSF) represents Main Street business in all parts of the state that have banded together to oppose Amazon getting a government-sanctioned advantage. AMSF is also calling for a national solution that allows states to ensure all businesses operating within their borders are able collect and remit sales taxes.

“The state should be doing everything it can to help all businesses prosper,” said Mike Cohen, spokesperson for the Alliance for Main Street Fairness (AMSF) in Tennessee. “The government shouldn’t be picking winners and losers by forcing local businesses to collect the sales tax, while allowing out-of-state companies to avoid doing so. Both the state and Federal government should do the right thing by creating a level playing field level that lets all businesses compete fairly.”

Business and Economy Tax and Budget Transparency and Elections

Amazon’s Tax Treatment Draws Barbs from Women’s Business Group

Advocates for small retail businesses say instead of focusing on big splashy job creation announcements, Tennessee policymakers should wake up to potential job losses resulting from those splashes.

As Tennessee launched its latest back-to-school sales tax holiday for the weekend, the president of a national nonpartisan group supporting women-owned businesses and a Tennessee small business owner held a teleconference Friday trying to draw attention to the adverse impact of e-commerce on the state.

Barbara Kasoff, president of Women Impacting Public Policy, and Maggie Jetter, owner of the Tweed Baby Outfitters store in Nashville, made their pitch for economic fairness and fielded questions from reporters Friday about the sales tax holiday. The looming figure in the discussion was

Amazon has become a white knight in the eyes of people trying to create lots of jobs in a short amount of time, with the online retail giant recently launching three large distribution centers in the state, and the possibility of even more. But at least some small businesses don’t see Amazon that way.

“I know they’re speaking about creating 1,500 new jobs, but you also have to keep in mind that with Amazon bringing a large company to Tennessee that’s not paying sales tax, you’re definitely coming close to putting out a lot of small businesses and losing even more than 1,500 jobs,” Jetter said.

Jetter and Kasoff offered no numbers in Friday’s conference call to back up the claim that job losses match the job gains, but Kasoff said small businesses create 93 percent of all new jobs.

“If small business retailers such as Maggie are not able to add jobs, that’s going to have a far-reaching and very significant impact on the economy,” Kasoff said.

Small retail advocates say it’s not simply that the brick-and-mortar stores are losing business to big online retailers but that losses in small businesses can hurt an entire community. When online retailers are exempt from collecting sales taxes, it puts a dent in the revenue streams for small governments and by extension, the services they provide.

Jetter said she can literally see the impact of online retailers on her store, which carries apparel for children, diaper bags and other baby products. She sees people come in so they can look, touch and feel the merchandise, then exit to go buy it online with no sales tax.

“I see it especially with this generation of parents,” she said. “A lot of the grandparents do shop here, but a lot of parents have all the online blogs and websites to find their deals, to register on Amazon, to get their diaper bags on there, which are one of our higher-priced items, which helps us pay the rent.”

Jetter said she is aware of Tennessee Gov. Bill Haslam’s offer to lead the call for national action urging Congress to level the playing field for states. But Kasoff was asked if it’s realistic to believe Congress would act to force handing over more taxes.

“Now that the (debt-reduction) votes of the past week are behind us, we hope that focus is going to be on building economic stability,” Kasoff said. “I think they’re going to take a hard look at this. I think the state legislatures across the country are going to be taking a hard look.

“We have to stabilize the economy. We have to bring some sense of stability and confidence back to consumers.”

Kasoff said sales tax holidays are an example of putting small retailers on a level playing field. While there is constant debate as to whether people are boosting business or simply shifting the timing of their purchases, Jetter said she definitely expected to see more business because of the brief sales tax break.

“This is just our second year as a brick-and-mortar store, but I do expect to see a lot of families here,” Jetter said. “I expect to see a good 10 to 20 percent more shopping because of tax-free items.” is an independent, not-for-profit news service supported by generous donors like you!

Press Releases

Amazon Sales-Tax Waiver ‘a Sell-Out of TN Businesses’: TFT

Press Release from Tennesseans for Fair Taxation, May 7, 2011:

Legislators move to reverse Administration’s Amazon exemption from sales tax collection.

Senate Finance Committee chair Randy McNally and House Finance Committee chair Charles Sargent will amend their bills SB 529 / HB 136 to clarify that sales tax be collected by businesses that have any physical presence in the State. These bills will be heard in Senate Finance Committee at 8:30 AM on May 10, 2011 and in House Finance Subcommittee at 10:00 AM the same day.

Gov. Haslam’s administration has secretly ruled that Amazon, the giant Internet retailer, need not collect Tennessee sales tax from sales through its “drop shipping” warehouse operations being built in Hamilton and Bradley Counties. McNally’s amendment explicitly requires that “drop shippers” and other dealers who operate physically in Tennessee must collect sales tax on Tennessee sales.

At a time of deep budget cuts, the special exemption would forego several million dollars annually in state revenue. The amended bills would raise at least $11.6 million according to a preliminary fiscal note.

“The Administration waiver of sales tax collection by Amazon is especially outrageous, as well as unfair, because it was made in secret behind closed doors without any public comment or action by the State legislature,” said John G. Stewart, former chair of Tennesseans for Fair Taxation. “This is a sell-out of Tennessee businesses, as well as a denial of legitimate tax revenue at a time of serious budget shortfalls and program cuts. In our democracy the Governor should propose but the Legislature should decide and that is what is proposed here.”

Amazon has agreed to locate two distribution centers in Bradley County and Chattanooga, and has already received more than $30 million in tax incentives from the State of Tennessee as part of the deal. But also demanded an exemption on collecting the Tennessee sales tax and remitting these tax revenues to the state, as is required of all Tennessee businesses. This exemption is in addition to the significant subsidies and incentives it received from the Bredesen administration.

Gov. Haslam acknowledged last week that Amazon’s demands for an exemption had been accepted. An article in the Chattanooga Times Free Press stated: ‘Asked directly whether Amazon would not be required to collect sales taxes on purchases made by Tennessee customers, Haslam said, “That’s exactly right.”’

The sales tax exemption was initially proposed by the out-going Bredesen Administration in a public notice posted in the last days of December 2010. The notice scheduled a public hearing in February to consider a change to the Department of Revenue rule governing the taxation of drop shipments.

At the last minute, after Tennesseans for Fair Taxation had requested an opportunity to comment, the hearing was cancelled. Governor Haslam’s 45-day moratorium on rule-makings was cited as the reason for the cancellation. Rather than reschedule the hearing and receive public testimony, the Haslam Administration secretly granted the exemption without any public notice or involvement.

If the Administration’s decision is not reversed it will hurt local businesses that must follow the law and already struggle to compete with the online giant.

Attorney Brian Paddock, a TFT volunteer noted: “When I asked a Retail industry representative about the Amazon exemption he wrote me a note saying:

The retail community in Tennessee believes that any deal to exempt or any other online-only retailer from collecting state sales taxes is a bad deal.  We are working with the Governor and the state Legislature to convince them that all retailers deserve equal tax treatment.  We support new jobs in Tennessee but not at the expense of the existing businesses.

All Tennessee retailers want is a level playing field.  We want competition to be fair.  Tennessee’s consideration of a plan to exempt Amazon from collecting state sales tax does the exact opposite and retailers across the state are justifiably upset.

Why should Amazon be exempt from collecting state sales tax?  Why should the state government, which in Tennessee operates primarily off sales taxes collected by existing merchants, put those same merchants at a disadvantage?  Why does a Tennessean running a business in these challenging economic times have to include state sales tax on each purchase, collect it, track it and pay it to the state when the state says a competitor selling the same product does not? wants to open distribution centers here and avoid collecting state sales taxes.  It’s wrong and it’s a bad deal. Tennessee’s retailers, big and small, deserve fair treatment and a level playing field.

“TennCare, higher education, and pre-K funding, among many other programs, are slashed in Gov. Haslam’s proposed budget, but revenue that could soften those cuts is not being collected by Amazon,” says Lorri Mabry of Antioch, Tenn. “It’s blatantly unfair and unwise. We need to collect all the revenue that is owed to the state – Tennesseans are hurting.”

Last week Gov. Haslam released his Jobs4TN plan with a focus on “assisting existing Tennessee businesses in expansions and remaining competitive.”

“The Amazon exemption flies in the face of the Administration’s professed objective of assisting Tennessee businesses,” said Katie Findley, a University of Tennessee (Knoxville) student. “All Tennessee businesses want is a level playing field and this decision gives a huge price advantage to Amazon.” Because of Tennessee’s high sales tax, small businesses already lose out to online and out-of-state competitors, and many retailers struggle to compete with Amazon, in particular.

Mabry and Findley also are members of Tennesseans for Fair Taxation, a statewide coalition of people and groups that support revenue with justice for all Tennesseans. TFT also supports the Out-of-State Sales Tax Act, sponsored by Sen. Beverly Marrero and Rep. Mike Stewart, which would require any out-of-state vendor selling more than $4,800 of goods annually to Tennesseans and using in-state affiliates to solicit those sales to collect the sales tax due on items sold.

The bill would override the administration’s backroom deal for Amazon, and would raise more than $100 million in additional revenue by requiring Amazon and any online or out-of-state vendor doing significant business with affiliate presence in Tennessee to collect sales tax.

Sen. Bo Watson has introduced a bill that would require “letter rulings” and “revenue rulings” like the one apparently made in the Amazon case to be open to the public. “Amazon can afford to collect the sales tax from its customers,” said Elizabeth Wright, executive director of TFT. “Tennessee can’t afford to exempt them from doing so. Any time one business doesn’t collect the taxes that are legitimately owed, other taxpayers must take up the slack, either in higher taxes or reduced government services.”

Lt. Gov. Ron Ramsey spoke out last week against the exemption, telling the Chattanooga Times Free Press, “It’s the one where you make an outright gift or do a sales tax exemption that no other business in the state has, those are the type of things that bother me,” Ramsey said. “This whole Amazon tax issue, that they’re not paying sales tax, I just don’t think that’s something that should ever have been agreed to.”

Business and Economy NewsTracker Tax and Budget

Big-Box Coalition Wants Amazon To Pay Tax

The Chattanooga Times Free-Press is spotlighting print ads by a national retailers group trying to force and other online retailers to pay sales taxes. The ads can be seen in Nashville, Memphis and Knoxville, the paper reported Thursday.

The piece offers a nice wrap of the legal context, what’s going on in other states, and where the Haslam administration stands. (The home team is looking the other way on the tax issue, and it’s possible Amazon will secure a “letter ruling” formally exempting its planned East Tennessee distribution centers from collecting taxes, though Revenue officials are mum.) Read the whole story here.

It’s worth noting that the group running the newspaper ads, the Alliance for Main Street Fairness, is backed heavily by Wal-Mart, Target, Home Depot, and the like.

The irony was not lost on House Majority Leader Gerald McCormick, who told the Chattanooga paper that Wal-Mart has “wiped out a number of Main Streets in Tennessee.”

While Tennessee welcomes Amazon, Illinois has taken a hard line, enacting a law requiring Amazon to collect sales taxes. California could follow suit. In Texas, lawmakers are seeking to address the tax question: at least two bills would force Amazon to collect sales taxes, and another would carve out an exception for Amazon. That state’s chief tax collector has said the retailer must pay up.

Business and Economy Featured NewsTracker

As Amazon Heads to TN, Retailer Shuns Texas’ ‘Unfavorable Regulatory Climate’

Amazon is pulling out of Texas because of that state’s hard line on collecting sales tax from the Internet retail giant’s sales. Some of those Lone Star State workers could relocate to Tennessee, where the company has been received with open arms by the Haslam administration, which has taken a much softer line on online tax collections. Amazon is building two massive distribution centers in East Tennessee.

KPRC Channel 2 in Houston reports that Amazon is closing its Dallas-area distribution center and won’t expand in Texas after a dispute stemming from the Texas state comptroller’s demand the company fork over $269 million in uncollected taxes.

Dave Clark, Amazon’s vice president of operations, writes in the e-mail that the center will close April 12 due to Texas’ “unfavorable regulatory climate.” Amazon spokeswoman Mary Osako would not say Thursday how many employees work at the Irving distribution center.

…(A state official) said Texas loses an estimated $600 million in Internet sales taxes every year.

Amazon has been the target of numerous lawsuits filed by states seeking sales taxes on online purchases made from within their borders.

Clark also said in his e-mail that the company was “previously planning to build additional facilities and expand in Texas, bringing more than 1,000 new jobs and tens of millions of investment dollars to the state, and we regret the need to reverse course.” Texas employees who are willing to relocate will be offered positions in other states, Clark said.

Gov. Bill Haslam has said his priority is making sure Amazon comes to Tennessee, and has shied away from the tax issue, but both he and Republican Lt. Gov. Ron Ramsey told the Tennessee Press Association Thursday they are committed to maintaining and enhancing the state’s reputation of having one of the business-friendliest political climates in the United States.

“I’m a small-business man myself, and you know what I want out of state government? Absolutely nothing,” Ramsey said. “Leave me alone. Get out of the way, and I’ll create jobs. All I want for government is to get out of the way.”

Late last year, Haslam said the issue of untaxed online sales was something “to look at long term, but I do not think it needs to interfere with our recruiting of Amazon to Tennessee. That’s a huge priority for us,” according to the Chattanooga Times Free-Press. The Chattanooga-area centers will reportedly be up and running in time for the Christmas shopping season.