Amazon.com has reached a tentative agreement with California lawmakers to resolve a battle over online sales tax.
Under the agreement, Amazon will drop its push to repeal an online sales tax in the state, and agree to begin collecting sales taxes from sales to residents in the state a year from now, according to reports by Bloomberg News and the San Jose Mercury News.
The Amazers are facing similar battles over sales tax across the country — a debate that highlights the divide between the worlds of traditional and online retail. Retailers with physical stores say the company enjoys an unfair advantage when it isn’t required to collect sales taxes.
In an editorial this week, the New York Times scolded Amazon for its position in California, saying it amounted to “an abdication of corporate responsibility.”
Earlier this year, Amazon CEO Jeff Bezos reiterated that the company believes a unified federal law is the best solution to the tax issue. The Mercury News reports that any federal legislation would supersede the deal Amazon has reached with California lawmakers. [24×7]
Google Offers Expands into Seattle
Google Offers has announced its launch in five new cities: Seattle, Denver, Austin, Washington, DC and Boston.
The program joins six other locations in four cities where Offers is already available: Portland (where it launched), San Francisco, Oakland and three sections of New York City.
The expansion of Offers comes at a time when others in the space are cutting back their efforts. Facebook and Yelp have both recently expressed doubts about the daily deals phenomenon, with Yelp explicitly raising questions about the sustainability of the large margins that companies such as Groupon and LivingSocial have generally enjoyed. Both sites will continue to offer deals of various kinds, but have scaled back their efforts.
Indeed, Google’s Offers vision is likely much larger than the current version of daily deals. It seeks to develop Offer Ads and tie deals and discounts to Google Wallet and check-ins at offline stores. There’s a much larger canvass and opportunity here. Point in fact, Google has recently updated its Shopper Android app to find, save and redeem offers at nearby businesses.
Not surprisingly, given the current spate of patent pushbacks, the Google Offers service is also facing its first lawsuit. Walker Digital, a private R&D lab that created and launched Priceline.com in the late 1990s, is suing Google for allegedly violating four of the company’s patents. The lawsuit, which asks the court for a jury trial, seeks unspecified damages and a permanent injunction.
Earlier this month, the company filed 15 similar suits against more than 100 defendants including Google, Facebook, Microsoft, Groupon, Amazon, eBay and Apple. Walker Digital also sued Facebook last year over its “friending” technology, according to paidContent. In a related story, Groupon has elected to put its IPO plans and “Road Show” on hold. [24×7]
