Retailers in Virginia are pissed off about this:

After California, Texas, New York and Indiana all enacted legislation forcing Amazon to start collecting the taxes and imposed deadlines to do so, Virginia startled observers of the Amazon-tax-scofflaw issue by announcing just before Christmas that it would allow the company to skip collecting state sales tax despite having a physical presence in the state.

If they made the same deal with Walmart, there would be outrage in the streets for the government-subsidized unfair competition, but The Great Walmart in the Sky is measured on a different scale than brick-and-mortar retailers.