Amazon seeks referendum vote on California sales-tax law

Online retailer solicits voters instead of filing lawsuit to challenge legislation

Online retailer Amazon.com says it plans to ask California voters to help it throw out a law that requires all retailers with operations or affiliates in the state to collect a 7.25-percent sales tax.

Amazon says the legislation, which went into effect on July 1, is unconstitutional and will cause more economic harm in a state where unemployment has surpassed 11 percent. The company says it will seek a referendum vote early next year.

Legal analysts say Amazon’s voter-targeting strategy will save the company tens of millions of dollars in legal fees it would otherwise have incurred if it had pursued a lawsuit to contest the sales-tax legislation.

Nonetheless, Amazon faces opposition from major retailers including Best Buy, Target and Wal-Mart, which contend that all retailers—online or brick-and-mortar—should be required to collect the same sales tax to level the playing field.

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