Jerry Brown down on Amazon proposal

September 2, 2011

Gov. Jerry Brown said Thursday that he is leaning against Internet retailer’s proposal to put off enforcing a new law that taxes online purchases in exchange for the company launching several California distribution centers that would create several thousand new jobs. [SacramentoBee]

“I’m concerned about anything that will reduce revenue going forward because we have a very uncertain economy,” the governor said. “Look, we need more revenues unless we’re going to keep curbing schools, courts, corrections.”
The new online tax is slated to bring in about $200 million a year to the state budget.

In exchange for a two to – reprieve in paying the online tax, Amazon has offered to open six new distribution centers in California that would create an estimated 7,000 jobs.

Amazon has not yet complied with the new law that requires online retailers to immediately collect sales taxes from California customers.

From downtown San Luis Obispo to the parking lot of the new Target store on los osos valley road, paid signature gathers have been asking shoppers to sign Amazon’s petition.

Amazon has spent more than $5 million on an initiative drive to overturn the new law. In response, state lawmakers are promoting another bill that would make the tax measure impervious to a ballot-box challenge, the Sacramento Bee said.

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I do my best to buy online and out of state as a form of tax protest: 8+% sales tax is way too much and strongly encourages people to find an alternative. Make the sales tax 5% and I’ll buy everything in state. I learned this from large companies who work the tax code and pay little or no taxes simply because they can. Ethical? No. Illegal? Another No. Welcome to 2011.

The State of CA can not force Amazon to collect sales tax from it’s customers. All they have to do is stop distributing from CA and all bets on charging sales tax are off. If Amazon ships it’s products into CA out of Oregon, they don’t ever have to charge anyone sales tax . What is Jerry Brown going to do, ban all California’s from buying from Amazon is doing all it’s customers a favor by refusing to charge us all an extra 8% sales tax and those who want to pay it can certainly do so. There is a line on your state tax return which demands that you report and pay sales tax on all on line out of state purchases.

Amazon is offering CA an alternative revenue stream, the added distribution centers.. Jerry would be wise to take it.

OK, a little simple math here… 7,000 jobs at let’s say $30,000 annual income equals $210 million. So that’s a toss up, $200 million in tax revenues (Jerry’s way), $210 million in income for 7,000 workers. The DIFFERENCE is that $210 million would go towards supporting 7,000 families. What do you think the state of California will do with their $200 million in tax revenue? It’s a no-brainer, give it to the workers (ahhh, no longer on unemployment or welfare… more $$$ money savings), plus that money would be put back into the economy as those families would spend their wages on rent, mortgages, food, etc.

No, the difference is giving $200 million to people in the private sector vs. wasting $210 million with the government to mis-spend.

Huge difference. I’d rather have the eeeeeevilist of companies (oil, pharma, whoever is being beaten on this month) pay ZERO in taxes, instead paying their employees or keeping their prices lower as a result than giving money to the government at this point.

Color me doubtful, but I think even a homeless person would spend a dollar more wisely than the government.

I am amazed at how wrong most people are viewing this situation; Governor Brown and the State of California are not trying to get Amazon to pay a tax, Amazon is being required to behave like every other business in the State of California by collecting sales tax on goods sold, and then paying the collected tax to the state, just like every other business operating in California. Why should Amazon be exempt? In the past, all internet businesses that are based in California or have a brick-and-mortar operation in the state or have a distribution facility in the state are required to collect sales tax for goods sold to residents of California. Amazon attempted to thwart California’s law by closing down all of their distribution centers; does that sound like a company that is trying to comply with the law? Amazon has really dropped the ball here and they need to step up and take responsibility by complying with California law, period.

Correction: that should read “like every other retailer in California ….. ” of course, not all businesses collect sales tax, only those that sell to consumers.

I believe that Amazon does not have a presence (open store front, offices, etc) in California. They are not like businesses that reside in California any more than any other mailorder companies outside the state. What a nightmare trying to keep the taxes straight for 58 different counties and thousands of cities that have a city tax as well. I’m tired of paying taxes and watching the state and politicians spend it like water.

Not quite, bob, yes, if Amazon was BASED in California, then they have to collect and pay the sales taxes; however, this is the new economy, and some companies might get shipments in and sent out from a distribution center in CA – that is where the gov wants to say “Ah ha! You must charge sales tax to the guy in Cleveland who ordered something from China that came in via Port of Los Angeles” (simplified version).

Because they have a “presence” here (read as “distribution center”) then they must collect and pay CA sales tax. So if you are in New York, and it SHIPS from California, but the company is based in Seattle, WA (as Amazon is HQ’d) then you have an issue that MUST be handled via the interstate commerce rules, and not California’s desire to skim off the top.

Of course, those interstate commerce rules were written back when things shipped from where they were made, but that’s been out the window since 1990’s.

The best thing CA could do is charge tariffs on goods coming in; not sure they can, as that’s generally Federal territory… California simply has no legal authority to collect sales tax from citizens of other states or countries, unless they buy something in California. But you can see how “gray” this all becomes.

This will be a fairly big issue as more and more brick-and-mortar stores close up shop, and more things are purchased online.

r0y: Linking to the article at the Sacramento Bee, and further linking to other articles on the Bee website, what I am reading is the new law is a refinement of the idea that an online retailer that either is based in California or uses California based distribution facilities and sells to a California resident, they are then required to collect the sales tax for that purchase. No where could I find any mention of attempting to force any online retailer to collect tax for purchases that are being shipped to another state; in other words, your “simplified version” is totally incorrect. Dig in a little deeper and see if you can find evidence to back up your assertion; I don’t think you can. I believe that the law is attempting to close a loophole that was allowing online retailers who were using California facilities to not collect sales tax on purchases to California residents. You may want to believe that the attempt is being made to collect taxes on all internet sales, but I cannot find anywhere where that is the case.

I didn’t think Amazon had any distribution centers here in California. The way I understand the law is if they have a physical building where they distribute or warehouse product then those receiveing said products will have to pay Ca. tax. Didn’t the Feds a year or two ago rule that those selling through the internet didn’t have to pay tax?

I love Amazon, I buy from them all the time. But they should have to pay their fair share of taxes. Once again big corps are getting away with getting wealthy off of the backs of the rest of us. They are trying to black mail the state by telling us that if we don’t let them off this tax thing then they won’t hire 7K people. First of all I don’t trust them on that one. Second, they will not stop selling and making millions from our state if we tax them. We will be better off with the taxes, with taxes we can save people that currently have jobs from losing their jobs. Scre@w the fat cat b@stards, tax em, they’ll still make a ton of dough and still won’t be paying the Feds what they should be.

Ever hear of the concept of voting with your wallet? Well, Amazon votes with your wallet. Some of the posters here have labeled you as liberal. If you are, how do you feel about the fact that Amazon is a major contributor to the Republican Party? The pennies you give to Amazon go indirectly to candidates who do not and never will have your best interests in mind.

Just sayin’

I don’t care if they contribute to the repubs, although that does explain the tax issue. There’s a few Repubs that I feel have my best interest in mind. But if Amazon supports Tea Baggers then I’m outta there, guess I had better do some research.

If Amazon continues to fight this tax thing and they don’t pay their fair share then I will not use them anymore. I buy a lot from Amazon, everything from Christmas gifts, coffee to college text books so this will be a tough one but I’m sure that there must be another good online site similar to Amazon or at least close. So if anyone knows of another site like Amazon let me know because I have a feeling that I’m going to be shopping around.

I am a tea bagger, and I try to spend locally as much as I possibly can – even when it’s a bit more (sometimes a lot more). I think ideology is such a twentieth century mindset, that it’s a bit of a let-down to see people say “democrat” or “republican” in political issues.

Many people have moved passed the parties, you can to. “Tea Party” is about as “party” as Federal Reserve is federal… or reserve! Think of a “tea bagger” as someone who wants accountability in their government, someone who wants every dime of taxes collected to NOT be wasted.

People are just getting sick of being railroaded by the “powers that be” and decided to take matters into their own hands… what is the problem with that? Sure there will be bumps in the road, have you ever run for office because you do not like how things are going? Do not be so condescending, it only looks bad and excludes you from serious debate and conversations, and we all need everyone’s input once in a while.

Tea party is NOT an ideology, rather it is just a fiscally responsible state of mind. You can be a tree-huggin’ liberal or a religious whacko conservative… what matters is, you do NOT want more taxes for more spending for more problems.

I’ve never met anyone in the Tea Party who thought there should be NO taxes. No NEW ones, sure. But everyone knows taxes and government are necessary, just not as much as we have.

r0y, I’m disappointed that you are a tea bagger. It really doesn’t matter what you think, their actions speak loudly, the Tea Parties are all about about ideology. They are about as much of a closed minded backwards group of people that I’ve come accross. I haven’t thought of you as ‘that type’ (omit original wording) so I’m quite disappointed. Look at who you support, Bachmann, O’Donnell, Palin, they are complete idiots as well as hypocrites.

I’ve watched several of these different Tea Bag group leaders on these political shows and they truly are dim. I will never ever support the tea baggers. I’m sorry that you would support openly racist people like many these Tea Bag people. They have never stood up to those that held the witch doctor signs and the Hitler signs at their rallies or the disrespect from their congressman that yelled out and called our Prez a liar while he was addressing congress, that was the ultimate of disrespect and it’s shameful. They openly carry guns at their rallies which is completely insane. The day Obama won the election, before he even took office the Baggers swore to never work with him on anything, they swore that they would fight and block everything he did and that’s just what they are doing even it means hurting the country.

The Baggers want to ruin our lives completely and take us back to the 1800s. They completely want the wealthy to get off scot from paying taxes and allow them to continue with these loopholes. You’re right in that the Tea Bags aren’t for no taxes, they want to raise the taxes on the bottom 50% (income) and let the wealthy get a complete free ride from the rest of us. The Tea Baggers are the most divisive groups of people that I’ve seen my lifetime. I am ready for a class war revolution and it is being spurred on by the Baggers. The sad part is that when one goes to these rallies or watches them on the tube most of their organizations are not wealthy people and they don’t’ know that in reality the entire purpose of the the TP movement is to aid the wealthy, they are pawns and they don’t it. If it were up to the TP Obama would have put this country in default. Screw the teachers, the firemen, the little guys, they didn’t need to get paid according to your TP. I need to stop on that, I really feel passionate about your group, that is why I have been to baggings and I have spoke up to them. When I left those baggings I was surprised that I felt sorry for them.

Not everyone that doesn’t like how things are going runs for office. That is why we vote.

As I said, if Amazon is at all affiliated with an Bagger group then I will never buy from them and I will speak out against them at every opportunity. Let the war begin, I’m ready. But let me again clarify, I’m not talking about the Republican Party.

OMG zap that was a great article, it should be mandatory reading. Thanks for posting it. I knew a little bit about the Koch brothers but not near as much as I should have. I didn’t know that there were four of them but that’s here not there. I had always heard about their power and that they were fascists but I really had no idea about the extent of their power and fascism. Their Nazi father and Aunt and Uncle, the ‘lampshade auntie’,,disgusting family, all of them. I knew that the the Koch bros were the major part of the foundation/roots of the Tea Party movement I didn’t realize just how much power they have. The group that they founded ALEC, that’s really disgusting, way too much power for big corps,,writing up 1000 (fascist) bills a year!

This goes with what I said in my last post regarding how I feel bad for the Baggers as they have know idea that they are pawns for big corp, real big selfish corps. I just want to shake the Baggers to wake them up from this mind control conducted by these true fascist.

They refer to themselves as libertarian but the roots are fascist indeed we have been living in Orwellville for quite a while

Absolutely, the fascists have a great deal of finical funding and we all know that money makes the world go round. Calling themselves Libertarians makes them sound cleaner and people like the Koch bros know it.

That was a good Bush bio. (your link). Bush was perfect for the fascists, he was like putty in thier hands. It’s hard to believe that this man that made important decisions like going to war on his gut instinct and his religious beliefs as opposed to facts and that this was and still is okay with the right (ie Perry). This is how Prez Bush the puppet for big corps ran our country. The Repubs get intellects in the office (Clinton and Obama) and they lose their minds. The right wants these faith based fascist backed people that appear to be down home dimwits that make decisions on gut instinct or corp interest to run our country. Wake up people.

My Neurological friends tell me we have more neurons in our guts than in our brain, and bacteria use language fermentation byproducts could be responsible for failed/persistent political ideologies. cheers!

Oh please, you sount like CNBC nightly news. The Tea Party isn’t the enemy. You want an enemy, what about Maxine Waters, Jimmy Hoffa Jr., etc and the rhetoric spewing from their mouth. They would like they would be happy to insite riots.

Well said Roy!

When are they going to get the clue in Sacramento? “Look, we need more revenues unless we’re going keep curbing schools, courts, corrections.” GOOD, DO IT. That’s what we hired you for. CUT the HELL out of the corrections facilities, in particular.

Plain and simple, more taxes = less business…

Moonbeam has inherited a mess but that mess has been in place for decades and run into the ground by the very party that elected him.

He is just towing the party line of crying that babies and grandma will suffer unless we raise taxes. The fact of the matter is most bills brought forward costing taxpayers more in taxes have a dem signature on the author page. There are an over abundance of laws and regulations that have driven businesses out California since the 70’s, and many have taxes or fees attached to them.

Now if the legislature along with the governor would sit down and go through the existing laws, regulations and mandates, one by one and cut the crap along with the unnecessary taxes or fees, then they might be able to actually balance a budget each year without raising more taxes and invite businesses back to the golden state…

The problem with “more taxes = less business” is that “more taxes” means nothing more than “more taxes on everyone except the rich”. If our leaders did in fact go through all the existing tax laws, they would see nothing but more justifications for giving tax breaks to the rich. If our current corrupt leaders were given the chance to fix something, it would end up more broken.

In terms of consumption tax or sales tax, yes those who buy will be paying more regradless of status level.

But, in terms of income tax it won’t matter much because 47% of registered taxpayers pay no tax at all, and the top 10% of taxpayers pay over 50% of the taxes.

Businesses buy materials and have to pay the taxes on these items, the shipping, the handling, the fuel to ship, the storage fees, and the ultimately pass all that on to the end customers…

What a load of cr@p. I’m so sick of hearing cons go on about how 47% don’t pay any taxes when in fact they pay more state, payroll, and local taxes than the wealthy. The reason they don’t pay income taxes is because they don’t make enough money to pay income taxes, they’re too poor but even with that they still pay an disappropriate higher percentage of taxes compared to the wealthy. That 47% are the grandmas eating dog food because they’re too broke to eat or the family of 4 that only make $15,000 a year. Now you cons want them to pay even more! Your rich cons corps aren’t giving them jobs, you want them to pay more taxes what next, what more can they do for your rich buddies? I clipped the following from an article:

“Data from the Tax Foundation show that in 2008, the average income for the bottom half of taxpayers was $15,300.

This year the first $9,350 of income is exempt from taxes for singles and $18,700 for married couples, just slightly more than in 2008. That means millions of the poor do not make enough to owe income taxes.

But they still pay plenty of other taxes, including federal payroll taxes. Between gas taxes, sales taxes, utility taxes and other taxes, no one lives tax-free in America.

When it comes to state and local taxes, the poor bear a heavier burden than the rich in every state except Vermont, the Institute on Taxation and Economic Policy calculated from official data. In Alabama, for example, the burden on the poor is more than twice that of the top 1 percent. The one-fifth of Alabama families making less than $13,000 pay almost 11 percent of their income in state and local taxes, compared with less than 4 percent for those who make $229,000 or more.”

I keep forgetting how California is so much better at building the economy with jobs… in the PUBLIC sector.

Probably one of the most stupid decision in a long line of mind numbing actions… by the way, the 200 million is predicated that California folks will continue to buy from Amazon and others.

BTW, has the governor signed the transparency bill, yet? I really want to look into Cal Poly’s Foundation, don’t you?

7,000 workers @ $40,000/year @ 8% income tax == 2,240,000, or 1/4 million dollars more than the online tax that they are talking about. This does not take into account the effect of those 7,000 workers NOT being a drain on the system and the $$ that they spend in the community creating a compound effect.

Sacramento just can’t help but shoot itself in the foot. Given the opportunity, they will pull on their blinders and pick the option that is the worst possible.

Nanny state mentality perpetuates the politicians tenure.


Gun Rights ARE Civil Rights

You would probably be dangerous if you could do basic math.

$2,240,000 is NOT more than the $200,000,000 that the state expects to collect in unpaid sales/use taxes. Hint – IT IS WAY LESS!

Also, who pays $3200 (8%) in state income taxes on a $40,000 per year job, anyway??? A single taxpayer who earns $40,000 pays $1228 and a married taxpayer with no kids pays only $395. As a result, your estimated income tax receipts are three to eight time too high.

In addition, what company would pay an average of $40,000 per year for warehouse workers?