If California targets Amazon.com Subsidiaries for Sales Taxes, can AWS continue to have locations in CA?

CNET has an article about Amazon.com distancing itself from its development groups in California.

California targets Kindle lab in Amazon tax spat

by Declan McCullagh

Amazon.com said today that it's reluctantly severing ties with affiliates in California, a move that it hopes will let it continue shipping products to state residents without collecting sales taxes.

The specific subsidiaries Amazon.com is severing ties with are A9 and Lab126.

The measure says that any retailer who "through a subsidiary" has any "place of business" in California must collect sales taxes. And--surprise!--Amazon has two subsidiaries in California: A9, in Palo Alto, which works on search technology, and Cupertino-based Lab126, which designed the Kindle and is rumored to be working onmuch more.

But, what about AWS's locations in CA?  Does AWS need to severe ties with those sites as well?


Amazon's Retail business model with customers avoiding sales taxes is an issue that affects Amazon's data center locations which then affects the AWS users as the operation of AWS cannot jeopardize Amazon.com's business model.

Is AWS's Northern California data centers next on will be spun off?  Ever wonder why Reno is a big distribution center for California?  Because, it is in Nevada along with a bunch of others who don't want to be in California's tax base.