(AP Photo/Paul Sakuma) (Paul Sakuma)
With by a federal appeals court judge, Internet retailers must abide by Colorado’s law regarding collection of sales tax. That is, if they don’t already collect sales taxes on purchases, retailers must notify Colorado customers of how much they owe the government and retailers must share personal details with the state’s Department of Revenues.
But this so-called “Amazon Tax” law isn’t one that the Seattle online retailer concerns itself with anymore. Amazon on February 1, 2016.
However, Amazon’s sales tax changes depending on how you order and where you live.
In a newsroom test, staff members here at The Denver Post were charged four different tax amounts for the same paperback book, currently on sale at Amazon for $9.18.
Here are the results:
7.6% = Tax for Denver resident with free shipping.
4.0% = Tax for Colorado resident living outside of Denver with free shipping.
7.6% = Tax for Denver resident paying for shipping.
4.0% = Tax for Colorado resident living outside of Denver paying for shipping.
Amazon won’t specify to us how or why it decides on the tax rate for Colorado customers. But on its it says taxes may vary based on the seller, item and destination.
In Colorado, Amazon charges 4 percent tax for all shoppers outside of the city of Denver. That proved true for newsroom employees and friends living in Lafayette, Centennial, Edgewater, Henderson, Arvada, Lakewood, Thornton, Westminster and Commerce City. The 4 percent tax rate includes:
2.9% Colorado state tax
1.0% Regional Transportation District
0.1%
____
4.0% sales tax
“Regarding RTD/SCFD, any retailer who sells an item to a purchaser who lives or does business within the RTD/CD must collect these taxes, which are remitted to the Colorado Department of Revenue,” said Lynn Granger, with the state’s revenue department.
However, people who lived in Denver were charged more, at 7.6 percent. That may include the city’s 3.65 tax.
According to the city of Denver, Amazon is licensed to collect city and county sales tax, said Courtney Law, communications director for the Department of Finance with the City and County of Denver. The amount collected is confidential under the Denver Revised Municipal Code.
“Denver does not have a special or additional sales tax rate, just the standard 7.65% city and state combined sales tax rate. As for why it may be lower in other jurisdictions, you might try contacting either Amazon or the other jurisdictions,” Law said.
Amazon won’t elaborate on tax collection and only says this: “I can confirm that Amazon was required to collect sales tax in Colorado beginning on 2/1,” said Teal Pennebaker, with Amazon’s corporate communications.
Residents in other parts of the state may also see a different rate based on local taxes. If you’re a Colorado resident and would like to share your Amazon taxes , send a JPEG to tchuang@denverpost.com.
Amazon is also charging taxes on shipping. And that is perfectly legal, according to Colorado’s Department of Revenue.
Granger pointed to “Transportation Charges” on page 17 of the .
Essentially, sales tax is charged when the seller offers no option for the customer to pick up the item in person. If the pick-up option is available, then shipping charges are considered a service and are not taxable.
