Soon, Amazon customers will finally pay sales tax. While that may seem to be a victory against Amazon’s aggressive rent-seeking, it isn’t. The company is accepting the taxes on its terms. In fact, the national law compelling Amazon to pay sales tax will help it save money as it builds warehouses.
The U.S. federal tax code requires corporations to pay 35 percent of their profits in income taxes. But of the 275 Fortune 500 companies that made a profit each year from 2001 to 2003 and for which adequate information is publicly available, only a few paid taxes near that statutory rate. Most paid much less.