The brick and mortar crowd should be careful what they wish for

Amazon bulldozer: "reach out and crush someone."

The Amazon bulldozer: “reach out and crush someone.”

Amazon will start collecting Connecticut’s 6.35% sales tax tomorrow, November 1st. In part, this effort was spurred by Connecticut’s insatiable appetite for new revenue, but traditional, land-based realtors have been demanding a level playing field and they think this will achieve that. They should think again.

Amazon’s giving up the sales tax battles across the country because it wants to move to same-day delivery, and the best way to do that is to establish warehouse / distribution centers in the same neighborhood as its customers. By December, 2014, just in time for the Christmas shopping season, it expects to have a 1,500,000 sq. ft. distribution center operating in Windsor. Once that happens, retailers with limited inventory and high prices will discover that the sales tax disadvantage was the least of their problems.

15 Comments

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15 responses to “The brick and mortar crowd should be careful what they wish for

  1. FF

    Except, Chris, Amazon signed the deal for the Windsor facility AFTER the 2011 law to collect tax, and Amazon has a policy of not fighting the assessment of taxes in states where they have such facilities. So I’m sorry but this isn’t a case of the evil liberals, but a Randian-type cool business decision by the Makers. And since Massachusetts and New York will also be collecting starting tomorrow, I suspect your plan to ship to an out of state location may be thwarted

    • You completely miss my point: Amazon quit the sales tax fight, nationwide, because of its corporate strategy to move to same-day delivery and to do that they will have to establish a physical presence in most states, thus subjecting them to sales taxes and rendering the issue moot.
      As to when Amazon made its decision to build in Windsor, I refer you to the Courant article I link to: the state dropped its claim for past taxes it claimed were due in exchange for the distribution center.

    • Inagua

      FF – When the Obamacare mandates hit your small business health insurance policy next year, will you tell us how much your premiums went up?

      You won’t mind will you? Shouldn’t Makers like you pay more so that Looters can get free or subsidized health insurance?

    • Anonymous

      …a Randian-type cool business decision by the Maker to sell to evil liberals

      Hey National Socialists, Commies, totalitarians, brown shirts, looters, moochers, they all like to shop too, just not for health insurance.

  2. Steve

    I’ve been saying the same thing for quite a while. A few years from now the local business are going to wish they could give Amazon back its tax free status and make it non-local again. Jeff Bezos thinks a few steps ahead of everyone else, so if he’s dropped his objection to collecting taxes it’s because he’s got something even better figured out.

  3. Anonymous

    I will no longer shop at Amazon

    • Steve

      You’ll probably be an Amazon Prime member within a year.

    • Retailing today

      Anon at 12:03pm….as a long time Amazon Prime customer ANDa frequent consumer of our wonderful local shops—this is called American capitalism. May the retailer who gives the most value (unique, quality items, reasonable price, fantastic customer service) win my business and those that don’t….well, sorry, but that’s the new playing field of retailing.

    • Cobra

      Prime is a great offer from Amazon. We often choose only products that are Prime eligible to avoid shipping charges usually incurred when ordering from non-Prime companies. Faster delivery, too.

  4. AJ

    For people like me who like the $.01 used books, they won’t be able to collect the NY .07% sales tax of less than a penny, so that’s going to be a full one cent, 100% sales tax I’m going to have to pay. Ouch!

  5. I never purchase anything through Amazon!

    • Anonymous

      Thanks for letting us know

    • Toonces

      I even purchase food sometimes from Amazon. It’s a fantastic company. Steve, I highly recommend prime membership. Like “retailing today” I enjoy our wonderful local shops (and shopkeepers) as well.

  6. I love the convenience of shopping at Amazon. They have just about everything I need and its a few mouse clicks away. No trying to beat out a latte sipping, Range Rover driving blonde for a parking spot on Greenwich Ave. There’s got to be a reason AMZN stock keeps going to the moon even when it makes no profits. Wall St must think they will own retailing soon. They might be right.