Illinois Gov. Signs "Amazon Law" To Levy Internet Sales Taxes

Illinois Gov. Pat Quinn (D) signed legislation Thursday requiring Internet merchants to collect the state’s 6.25% sales tax, the Chicago Tribune reports.

The controversial legislation, dubbed the “Main Street Fairness Act,” means online retail giants like Amazon and – will have to collect sales taxes on Illinois purchases as long as they maintain “affiliates” in the state.

Amazon, which vociferously opposes any Internet sales taxes, is now threatening to pull its business out of the state. The Seattle-based company said Thursday that it plans to terminate its Illinois affiliates.  These smaller “affiliated”  websites are paid a fee by Amazon and other online merchants for driving sales traffic through links and ads.

Amazon has made good on similar threats against affiliates in North Carolina, Rhode Island and Colorado after those states passed Internet sales tax laws, and has threatened to do the same if legislation is passed in California. Amazon collects sales tax in New York but is challenging the state’s “Amazon Law” in court.

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