Amazon Web Services, the cloud computing unit of the Seattle online retailer, notified customers in Washington state this week that it plans to begin collecting sales tax on the online services if offers next month.
“We wanted to let you know that starting with your March 2012 bill (sent out at the beginning of April), AWS will begin collecting Washington State sales tax for accounts with a billing address in the state of Washington,” the company wrote in a message to customers. “We are doing this in order to comply with changes to state law, which requires us to remit this tax to the State.”
Amazon.com has been locked in an ongoing battle with many states over the collection of sales tax as it relates to the sale of physical goods. The company has argued that it should not have to collect sales tax because it does not operate brick-and-mortar operations in those states, and it has lobbied for a federal policy on sales tax collection.
In Washington state, where Amazon.com is headquartered, it has always collected sales tax when customers buy a book, . But the move to collect the tax on online services like S3, EC2 and Dynamo DB could signal a new move.
We’ve reached out to both Amazon.com and the Washington State Department of Revenue for comment, and we’ll update the post as we hear more.
Tatango CEO Derek Johnson, an Amazon Web Services customer, received the notification Thursday. He said the tax increases will have little impact on his Seattle text messaging marketing startup since the company’s server needs are fairly minimal.
“Governments are always looking for additional sources of revenue and this is just another way to tap into sales tax revenue that isn’t being collected,” noted Johnson. “If I was managing Washington state, I’d be going after the additional revenue as well.”