Amazon will collect, pay Mississippi tax on online sales

Online sales giant Amazon has agreed to start collecting a 7 percent tax on Mississippi sales and returning it to the state, Department of Revenue Commissioner Herb Frierson said Tuesday.

The move comes as Mississippi lawmakers prepare to consider passing laws and enjoining Alabama and others in litigation over online sales taxes. Amazon will begin collecting what is technically a "use" tax for Mississippi on Feb. 1.

Frierson said Amazon is by far the largest online seller in Mississippi. He said he can't divulge Amazon's estimate of how much the tax will bring in for Mississippi, but that it's "south of $30 million a year, and north of $15 million."

"It will be a big help for (the 2018 fiscal year budget)," Frierson said. "It won't solve all our problems, but it will be a help."

Frierson said his office — primarily Associate Commissioner Meg Bartlett — has been negotiating with Amazon for some time, and he praised his staff's work. He said he plans, through "administrative process," to start asking companies that do $250,000 or more a year in online sales in Mississippi to start collecting and returning a 7 percent "use" tax that has been on the books for years, and which some state leaders have said online sellers should already be paying.

"If they do this voluntarily, we won't go back and do a three-year audit on them," Frierson said. "... I hope Amazon causes other people to want to do this. It's the painless way of getting it done."

Legislation, including a bill by Rep. Trey Lamar, R-Senatobia, is pending this session as lawmakers look for ways to fill budget holes from anemic revenue. Lamar's proposal would require sellers doing more than $250,000 to pay.

Some state officials have estimated levying sales or use taxes on online sales would net the state about $300 million a year.

Contact Geoff Pender at 601-961-7266 or gpender@gannett.com . Follow him on Twitter .