Online Sales Tax Debate Rages in CA

New political group calls for Amazon boycott.

by staff writer
- Aug 17, 2011

California may have approved an online sales tax law in June, but residents haven't laid the online sales tax issue to rest.

A new group is calling on consumers to boycott Amazon and cancel their accounts with the company because of its anti-sales tax stance. ThinkBeforeYouClickCA is composed of nonprofit organizations and California politicians. According to news reports, the group came together after Amazon contributed $3 million to More Jobs Not Taxes, an organization that aims to repeal the recently approved online sales tax law.

More Jobs Not Taxes says the online sales tax law will "hurt small business, kill jobs and undermine chances for any economic recovery in California." However, ThinkBeforeYouClickCA says online retailers like Amazon need to "play by the same rules as everyone else doing business in California."

More Jobs Not Taxes is currently gathering signatures to put the issue on the ballot next year. To do this, the organization, which is comprised of consumers, small businesses, taxpayers and online retailers, would need to gather more than 500,000 signatures by Sept. 27. If the referendum gets on the ballot, the sales tax law will not be enforced until after the vote, according to news reports.

The online sales tax law requires out-of-state online retailers to collected sales tax from California residents if companies are "engaged in business" in California and make more than $50,000 a year. After the California law passed in June, Amazon cut ties with affiliates in the state.

Proponents of the law say it will level the playing field between brick-and-mortar stores, which have to collect sales tax, and online retailers, which often don't collect sales tax. Opponents say the law gives small-business owners unnecessary burdens.

About the Author

Auctiva staff writers constantly monitor trends and best practices of those selling on eBay and elsewhere online. They attend relevant training seminars and trade shows and regularly discuss the market with PowerSellers and other market experts.

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