Wednesday, April 27, 2011

South Carolina Rejects Tax Break for Amazon

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COLUMBIA, S.C. (AP) -- South Carolina legislators rejected Wednesday a sales tax break for online retailer Amazon.com in a 71-47 vote the House Majority leader blamed largely on Republican Gov. Nikki Haley.

The proposal would have exempted Amazon from collecting sales taxes in South Carolina for five years, if it provided at least 1,249 full-time jobs and health care benefits for employees. Amazon has threatened to stop building a distribution center in Lexington County, and abandon its plans, if it's forced to collect the taxes from South Carolina shoppers.

Supporters said South Carolina needed to honor a deal struck last summer with the Commerce Department under former Gov. Mark Sanford. It would extend a five-year-old break put on the books to help win a QVC distribution center, which has expired.

If South Carolina doesn't deliver on this, future attempts to lure jobs to the state will be put in jeopardy, said House Ways and Means Committee Chairman Dan Cooper, R-Piedmont.

He said South Carolinians don't pay sales taxes now when they shop on Amazon, so there's no loss to the state. If the company pulls out, state residents still won't pay sales taxes when they order online, Cooper said.