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New Jersey residents to pay sales tax on Amazon purchases

Governor's administration makes deal with retail giant to open distribution centers and begin collecting tax.

New Jersey Governor Chris Christie listens as Paul Misener, Amazon's vice president of Global Public Policy, speaks about the company's agreement with the governor's office.
Tim Larsen/Governor's Office

New Jersey residents ordering from Amazon will pay sales tax on their purchases next year, the state's governor announced today.

Gov. Chris Christie said his office has reached an agreement with the company, which plans to begin construction on two "state-of-the-art" fulfillment distribution center facilities in New Jersey next year. While the center is expected to create several thousands jobs, Amazon will also start collecting taxes as part of the deal, according to a press release.

Amazon will start collecting sales tax by July, 1 2013, unless federal legislators can establish legislation for sales tax collection from out-of-state retailers before then.

The company currently collects sales tax on purchases made in Kansas, Kentucky, New York, North Dakota and Washington, according to its Web site. The retail giant has long resisted collecting taxes, threatening to shut down distribution centers in protest.

Distribution facilities help sellers store products before they are shipped to customers. In New Jersey, the new centers are expected to result in at least $130 million in capital investment and create more than 1,500 full-time jobs, according to the governor's press release.