I think Amazon will still be able to compete in this scenario. They can (and will have to) calculate sales tax. Plus, the tax will be based on the state that

I think Amazon will still be able to compete in this scenario. They can (and will have to) calculate sales tax. Plus, the tax will be based on the state that I reside in, not the state that the merchant resides in, so there won't be any "gaming the system" to find the lowest price.