http://www.ft.com/cms/s/0/91c3a654-a2a8-11e0-83fc-00144feabdc0.html#ixzz1QisJtnIB Amazon battles California sales tax By Barney Jopson in New York and Matthew Garrahan in Los Angeles Amazon, the worldâs biggest internet retailer, has threatened to sever its ties with online advertisers in California in response to the stateâs new budget, which requires internet retailers to collect sales tax from shoppers. The stark threat over a move Amazon described as âunconstitutional and counter-productiveâ comes as California grapples with a $9.6bn deficit. Amazon said it would cut its ties as soon as the measure became effective. The move in the most populous US state would be Amazonâs boldest yet in its fight against state efforts to collect sales tax from online shoppers who, in most cases, have not had to pay the levy since the birth of e-commerce. States such as California see the internet sales tax as a means of narrowing their budget deficits. They are supported by âbig boxâ retailers such as Walmart and Home Depot, which complain that online rivals gain an unfair price advantage from a tax loophole.