Dallas Moring News

Amazon.com offers Texas 5000 jobs in exchange for sales-tax exemption

DALLAS — Amazon.com wants to make a deal with the state of Texas.

The proposed offer circulating around Austin and obtained by The Dallas Morning News would let Amazon off the hook for collecting sales taxes from its Texas customers over the next 4 ½ years, and would bring 5,000 jobs to the state.

The company also is promising to spend $300 million to open distribution centers where those employees would work.

Finally, it wants the Texas comptroller's office to set up a website where its customers can send sales tax owed on Amazon purchases to the state. Historically, voluntary sales-tax payments haven't been reliable.

South Carolina recently accepted a similar offer from Amazon.

Amazon didn't respond to a request for comment.

The Seattle-based online superstore made the offer after the Texas Legislature reaffirmed a bill provision that would force Amazon and other online retailers with a physical presence in the state to collect sales taxes.

In the regular session of the Legislature, Gov. Rick Perry had vetoed an online sales-tax bill by Republican Rep. John Otto and Democratic Sen. Royce West. Then lawmakers inserted the same language into a pending school finance bill in a section on revenue generators. The finance bill must be passed to fully fund schools, and the special session ends June 29.

The comptroller's office estimates that Amazon owes the state $269 million in uncollected sales taxes from 2004 to 2009, plus penalties.

Perry's deputy press secretary, Lucy Nashed, said Monday that the governor continues to support legislation that creates jobs in Texas.

Perry can't veto the school bill's section that pertains to online sales-tax collections. He would have to veto the entire finance bill and call a new special session without a guarantee that the Legislature would side with him.

Many believe that Congress should tackle online sales taxes at the federal level, and Perry has said he believes it's a federal issue.

The Main Street Alliance, a coalition of big and small retailers, urged legislators "to stand their ground and support the language that has been studied and received overwhelming votes all session."

Alliance spokesman Eric Bearse noted that Amazon didn't make the offer during the regular session and called it a "last-ditch, desperate appeal to protect their tax evasion status for another 4 ½ years."

Besides the governor's office, it's not clear to whom Amazon is pitching its moratorium offer. A spokeswoman in Otto's office said that no one from Amazon has contacted the bill's author, and several other state representatives and senators contacted Monday said they hadn't heard from Amazon.

House honors Kelleher and Southwest Airlines on its 40th birthday ...

The employees of Southwest Airlines are free to move around the House floor. Up at the dais, at least.

On Tuesday, the House honored the 40th anniversary of the Dallas-based airline's founding. Speaker Joe Straus, R-San Antonio, began on a wry note, saying, "Members, you might want to make sure your seat backs and tray tables are in their full upright position." The House then unanimously passed a resolution by the dean of the House, Rep. Tom Craddick, R-Midland. It notes that on June 18, 1971, Southwest began commercial flights with three Boeing 737s and fewer than 70 employees. Today, it's the largest commercial airliner in the U.S., with a fleet of more than 500 737s and nearly 35,000 people on the payroll. "Southwest is a true icon of Texas," Craddick said. "They changed the face of this state, the way people got around and the way business was done."

Former Southwest chairman and chief executive officer Herb Kelleher said it was a phenomenon even bigger than Texas (if the mind can conceive of anything so large).

Kelleher, in brief remarks to the House, built on this passage in the resolution: "Over the last four decades, the percentage of American adults who have flown on a commercial airliner has risen from 15 to 85 percent, a result that is often referred to as the 'Southwest Effect.'"

Kelleher (above, 2008 DMN photo) called it "a worldwide revolution, as well as a Texas revolution." He thanked the Legislature and Texas Supreme Court for siding with the infant Southwest in its battles with entrenched airlines. Calling the Lege Southwest's daddy, he said "your child has really served as a role model for carriers around the world. Southwest has been emulated every place on the inhabitated continents, and what has that caused? Billions of people have been enabled to fly that previously could not."

Kelleher, current chairman and CEO Gary Kelly and other Southwest executives and their spouses then formed a receiving line and chatted with House lawmakers for a good half hour.

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