Amazon tax pact helps Idaho, retailers

COEUR d’ALENE — An announcement that one of the world’s largest online retailers will begin charging sales tax to Idaho customers is being hailed locally as a big win for Main Street.

Last week, Amazon announced it had reached an agreement with Idaho and will begin charging residents a 6 percent sales tax on April 1. The move is expected to generate $15 million to $20 million a year for Idaho.

Steve Wilson, president of the Coeur d’Alene Chamber of Commerce, told The Press Monday that addressing the online sales tax issue has long been a priority of chambers of commerce throughout the state.

“This is a step in the right direction,” Wilson added. “I applaud Amazon for leveling the playing field. I would hope this makes local businesses more competitive.”

All online sales are already legally subject to sales tax in Idaho, but the state doesn't have a simple way to collect from out-of-state sellers. That means consumers typically have to self-report and pay the taxes on their own.

State officials have long suspected many people don't self-report, but no legislation was passed addressing those suspicions. The agreement with Amazon, which already collects state sales taxes from all but a handful of states, will bring in a large portion of those taxes to Idaho’s general fund.

“We consider this to be a matter of fairness,” Gov. Butch Otter said in a prepared statement. “As an industry leader and one of the world’s largest retailers, Amazon’s decision will provide more tax revenue to help pay for the essential operations of state government.”

Just as important, Otter added, is the agreement helping Idaho taxpayers comply with state law and the creation of a more-level playing field for Idaho’s brick-and-mortar retailers.

Jamé Davis, president of the Post Falls Chamber of Commerce, told The Press the chamber supports initiatives to “keep it local” by supporting brick-and-mortar stores in the community. But, she added, convenience often trumps that philosophy.

“Consumers are many times responsible to self-report the sales tax with online purchases, which isn’t the most accountable way to collect,” Davis said. “I believe this change is not only responsible, but will create a more-level playing field for our local businesses.”

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The Associated Press contributed to this report.