State & Local Government Policy, Business and Technology

States Go After Small Businesses on Amazon—and Sometimes Amazon—for Millions in Back Sales Taxes

Route Fifty: Amazon is one of the nation’s largest retailers in part because of its rapidly growing online marketplace, which allows small business owners to sell their products to a vastly larger group of consumers. In fact, Amazon’s marketplace sales more than doubled in just three years, climbing to about $230 billion in 2019, accounting for more than half of the online giant’s business.

But up until last year, many of those sales weren’t taxed because the legal requirement to do so was murky. Now, some state governments are trying to recoup those taxes. But whether they’re going after Amazon or small business owners themselves for that money depends upon the state.

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