Schwarzenegger: No internet sales tax in California, please stick around Amazon
In recent weeks, Amazon and Overstock have shut down affiliate stores in a handful of states that have passed such laws. Basically, the way things work right now is that online stores don't have to collect sales tax in a US state unless the store has a physical presence in that state. A handful of states including New York, North Carolina, Rhode Island, and Hawaii either have, or are expected to adopt policies that consider affiliates to fit the bill.
What's an affiliate? It's a person or business that has signed up with a web retailer to post links to the online store in exchange for a commission. Basically, it can be some guy who runs a web site that only his grandmother reads or a newspaper web site. Either way, it's not exactly a local store branch or distribution center. But I can certainly see how a state could decide affiliates constitute physical presence in a state. But I can also see how retailers would decide it's easier to pull out of that state altogether rather than have a competitive disadvantage with retailers that don't have affiliates and therefore don't have to charge sales tax.
[via Techdirt]
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Reader Comments (Page 1 of 1)
D said 9:53AM on 7-07-2009
too bad he cant run for re-election.
Reply
octoberasian said 12:25PM on 7-07-2009
I'm from California, and not to make this a political discussion, but I find it noble that he doesn't want to raise taxes in our state.
The state has already begun handing out IOUs because the state legislature can't get a budget out. Reading that Twitter comment above is just hillarious.
If there's something about running a city or a state and how it resembles Sim City in many ways, you can raise revenue without raising taxes. You just have to be smart on which programs to cut or remove without be vilified or criticized for doing so. And, the first and most important thing to do is gradually pay off any loans the city or state owes. As soon as that is paid off, you find ways to make revenue. In Sim City, I know it may be a bad example, selling excess water, trash capacity, and/or power to neighboring cities helped increase revenue.
Let's see, California is in a drought so water is something we can't do, and increasing trash capacity would have the environmentalist on our ass. However, you can see the point I'm trying to make.
I wouldn't mind seeing run for governor again. He wasn't the greatest, but he is thinking more about us, especially when he doesn't want to raise taxes. Now, only if the State Legislature can start working together instead of apart to get a budget drafted and put the State towards economic recovery.
Reply
JJ said 11:39AM on 7-07-2009
I'm from California, and not to make this a political discussion, but I find it noble that he doesn't want to raise taxes in our state.
The state has already begun handing out IOUs because the state legislature can't get a budget out. Reading that Twitter comment above is just hillarious.
If there's something about running a city or a state and how it resembles Sim City in many ways, you can raise revenue without raising taxes. You just have to be smart on which programs to cut or remove without be vilified or criticized for doing so. And, the first and most important thing to do is gradually pay off any loans the city or state owes. As soon as that is paid off, you find ways to make revenue. In Sim City, I know it may be a bad example, selling excess water, trash capacity, and/or power to neighboring cities helped increase revenue.
Let's see, California is in a drought so water is something we can't do, and increasing trash capacity would have the environmentalist on our ass. However, you can see the point I'm trying to make.
I wouldn't mind seeing run for governor again. He wasn't the greatest, but he is thinking more about us, especially when he doesn't want to raise taxes. Now, only if the State Legislature can start working together instead of apart to get a budget drafted and put the State towards economic recovery.
Reply
George said 2:58PM on 7-07-2009
There's no news here. California already charges sales tax on Internet sales!
The catch is that the CA government collects it directly from the buyers and they call it "use tax".
http://www.boe.ca.gov/pdf/pub79b.pdf
Worst law EVAR.
Reply