Connecticut is expected to recoup an additional $15 million in annual sales tax revenue with Amazon.com Inc. announcing today that it would begin collecting sales tax in Connecticut Nov. 1.
Under an agreement with state officials, Amazon will also invest $50 million over two years to build a Connecticut distribution facility that is projected to create 300 new jobs, Gov. Dannel P. Malloy announced at a Feb. 4 news conference, according to published reports.
Malloy, according to reports, said the agreement includes a provision that the state will not sue Amazon over the collection of past sales tax revenues. He added that Amazon has not yet chosen a site for the new facility.
“Amazon’s multi-million dollar investment and the hundreds of jobs that will come with both the construction and operation of their future facility will unquestionably boost our local economy,” Malloy said in a prepared statement.
Connecticut’s sales and use tax rate is 6.35 percent for most goods and taxable services. Under federal law, out-of-state retailers cannot be required to collect tax on sales in Connecticut. Both Malloy and Paul Misener, vice president for global public policy of the Seattle-based company, called for federal action to resolve inconsistencies in how sales tax is collected.
“We … look forward to working with Governor Malloy toward passage of the legislation now being considered by Congress that would finally resolve the sales tax issue, level the playing field for all retailers, protect states’ rights and allow states to collect the revenue owed,” Misener said in a statement.