Eager to host Amazon warehouses and receive a cut of the tax on sales to customers statewide, two California cities are offering Amazon most of the tax money they stand to gain.

Written By Marc Lifsher

PATTERSON, CA - Amazon.com Inc. for years has fought government efforts to tax e-commerce. Now it's poised to pocket millions of dollars in sales taxes paid by California customers.

As part of a pact reached last year with state lawmakers, some online retailers agreed to begin collecting sales taxes this fall. About half of the projected $316 million raised in the first full year is expected to come from merchandise sold by Amazon, which is also setting up two California fulfillment centers that will employ at least 1,000 workers each.

San Bernardino and Patterson, where the centers will be located, will gain not only jobs but also a tax bonanza: Sales to Amazon customers throughout California will be deemed to take place there, so all the sales tax earmarked for local government operations will go to those two cities. It's a windfall so lucrative — about $8 million a year initially for each city — that local officials are preparing to give Amazon the lion's share of their take as a reward for setting up shop there.

Talks with Amazon... http://www.latimes.com/business/la-fi-amazon-sales-taxes-20120520,0,4308...