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Connecticut is chasing $269 million from Amazon |
Connecticut has become the latest US state to put pressure on online retailer Amazon over the payment of sales taxes.
The announcement comes six months after the SEC began an investigation into the company's dispute with Texas, after the state charged the company with more than $269 million in unpaid taxes from 2005 to 2009.
Connecticut has joined a list of states that have implemented new laws demanding online retailers to collect sales tax to help sure-up growing budget deficits.
The new law came into effect in May 2010 but Amazon has argued that it is immune because it does not have a physical presence in the state.
Sixteen other states are rumoured to be prepared to enact similar laws.
Amazon claims that it cut all ties with affiliates in the state one month after the law was introduced.
The company is still involved in a battle with the state of New York but recently agreed to deals to pay sales tax within two years in California and Tennessee.
Amazon now only pays sales tax in a small number of states, such as Washington, where the company is headquartered.
Under a 1992 Supreme Court decision, Quill v North Dakota, a company must have a so-called physical presence in a state to be subject to sales tax there.
In May, Texas required Amazon to collect sales tax on transactions with residents within the state because the company operated a warehouse near Dallas, which, Texas argues, qualifies as a physical presence.
Amazon does not think that the warehouse, which is owned by a subsidiary, is a sufficient nexus, or link, to the state for purposes of satisfying the Supreme Court's requirements in Quill.
In its regulatory filings, Amazon wrote: "[The newly proposed state taxes] could create administrative burdens for us, put as at a disadvantage if they do not impose similar obligations on all of our online competitors, and decrease our future sales."
