Amazon to Begin Sales Tax Collection in Illinois
Amazon will start collecting sales tax from Illinois consumers next month to comply with a new state law in Illinois.
Amazon spokesman said the online retailer will be required to collect the 6.25 percent tax starting Feb. 1. That is most likely still less than the state plus county rate that most consumers are accustomed to spending.
Background of the New Legislation
- Illinois lawmakers passed the measure last summer.
- The action came after the Illinois Supreme Court threw out an earlier attempt at legislation.
- The court ruled the earlier law violated federal rules against “discriminatory taxes” on digital transactions.
Retailer Support and Legal Adjustments
The updated law addressed the court’s concerns.
Illinois retailers supported the legislation to level the playing field for brick-and-mortar businesses.
Frequently Asked Questions
Why is Amazon starting to collect sales tax in Illinois?
Amazon is collecting sales tax in Illinois to comply with a new state law requiring online retailers to collect the state’s 6.25% sales tax from consumers starting February 1st.
What is the new sales tax rate for Amazon purchases in Illinois?
Amazon will collect the state’s base rate of 6.25%. This may still be lower than the combined state and county sales tax rate Illinois consumers typically pay.
When does Amazon’s sales tax collection in Illinois begin?
The sales tax collection will begin on February 1st, as mandated by Illinois’ new legislation.
What prompted Illinois to pass this new sales tax law?
The Illinois legislature passed the law after the state Supreme Court struck down a previous version for violating federal rules against discriminatory taxes on digital commerce.
How do Illinois retailers feel about this change?
Illinois brick-and-mortar retailers generally support the law, as it helps create a level playing field between online and physical stores.