Jul 142011
 
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Image by kokogiak via Flickr

Amazon, the world’s largest online merchant, has an ambitious and far-reaching new agenda: it wants to rewrite tax policy for the Internet era.

Amazon said this week that it would push a voter initiative in California that could eliminate sales tax for virtual sellers with only a modest physical presence in the state. Its move instantly escalated the company’s long-running battle with many states over collecting sales tax, taking the question directly to voters. And it has sharply intensified its dispute with physical retailers like Wal-Mart Stores and Target, which have vowed to fight the measure.

Some political science and business professors say the conflict could take on the polarizing nature of Proposition 13, a decades-old referendum that limited property tax increases and remains a lightning rod in the state. Political experts say Amazon’s proposed referendum is likely to gather the signatures necessary to appear on the ballot as early as next February.

Nancy F. Koehn, a retail historian at the Harvard Business School, said the initiative highlighted the evolution of Internet retailing into a “major highway of commerce.”

Internet shopping “is no longer a small, out-of-the way quirky tributary of shopping,” she said, adding: “It’s the fastest-growing distribution channel in America. This is a referendum on how we’re going to treat it.”

She said that what happened in California could catch on in other states and have a domino effect.

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