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St. Paul, Minn.

Amazon may add new services in Minnesota

An Amazon warehouse in Germany
An Amazon warehouse in Brieselang, Germany.
Getty/Sean Gallup

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Amazon will start charging sales tax to its customers for the first time beginning Oct. 1 and some experts believe that's a signal the Internet retail giant is going to make a move into Minnesota.

"What it probably implies is that they're building a new fulfillment center," said Gene Munster, a senior research analyst with Minneapolis based investment firm Piper Jaffray. "They have about 90 of those in the US. And ultimately having one closer to the [Twin] Cities is going to provide some additional services, like same-day delivery and potentially even groceries at some point. So that's the catalyst for having this change in the tax code."

Same-day delivery and groceries "are a big, critical part of how they're going to get more out of your wallet. And same day delivery, it's surprising how important that is for people when they think about e-commerce versus buying things locally, so that's an advantage for Amazon," he said.

Munster also thinks an Amazon sales tax will also help retailers like Target and Best Buy compete better on price for Minnesota customers as well.

Click on the audio link to Munster's conversation with MPR News Morning Edition host Cathy Wurzer.