Online retailer giant Amazon will no longer be tax-free for Iowans starting Jan. 1.

An Amazon spokesperson told KCCI in a brief statement, "Amazon will be required to collect sales tax in Iowa beginning on Jan. 1, 2017."

Iowa will be the 31st state in which orders made on Amazon.com will include a sales tax.

Neighboring state South Dakota has already passed a law that requires businesses to collect sales tax after making a certain amount.

With Amazon's announcement, smaller businesses could benefit as more online shoppers make bigger purchases through the site.

"It really is one of fairness to your brick-and-mortar, small-town retailers who have a physical presence here, who have employees, who have property tax that they pay," said Victoria Daniels with the Iowa Department of Revenue, "They're losing sales to companies that aren't even here."

This means a bump in a general fund revenue from the increase sales tax revenue, Daniels said. Last year, there were $2.6 billion in tax sales in the state of Iowa, and online sales are growing at a rapid rate.