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Following in Texas' footsteps, Virginia retailers are making a strong push to make Amazon.com charge sales taxes after the Seattle-based retail giant opens two large

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Virginia Joins the Fight to Take On Amazon

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Following in Texas' footsteps, Virginia retailers are making a strong push to make Amazon.com charge sales taxes after the Seattle-based retail giant opens two large distribution centers in the state. At issue is the vexing question as to how growing online sales should be taxed. Now, Virginia has signaled that it make take the Lone Star state's lead in defining Amazon's distribution center in Fort Worth as a "physical nexus," and therefore requiring Amazon to collect the tax on sales to Texas residents.

Virginia's bricks-and-mortar retailers, of course, are raising the same complaint that a number of revenue-starved states and traditional businesses have raised -- that by not collecting the sales tax from its residents, the state is forfeiting millions of dollars in taxes.

As the Richmond Times-Dispatch reports, "Several trade groups for retail businesses in the state are pushing legislation that will seek to change the tax code and look at the 'nexus issue, or physical presence of a company,' said George Peyton, vice president for governmental relations for the Virginia Retail Federation."

The paper also noted that researchers at the University of Tennessee projected in 2009 that state and local governments nationwide will lose nearly $1.4 billion in revenues from uncollected taxes from online sales by 2012.

The whole matter of collecting sales taxes from out-of-state retailers is a complex one, from a legal standpoint. Though a 1992 U.S. Supreme Court decision held that retailers are exempt from paying sales taxes in states where the have a physical presence, the court does allow Congress to enact legislation, if it so chooses to, that would mandate all sellers to remit the tax.

Amazon has said that it supports federal legislation that would do that, though the company has gone out of its way to avoid charging the tax to consumers in most states, even those with distribution centers.

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