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In your Opinion~ Will California be BAD for Business?

 

Gov. Jerry Brown has signed into law California's tax on Internet sales through affiliate advertising which will immediately cut small-business website revenue 20% to 30%, experts say.

The bill, AB 28X, takes effect immediately. The state Board of Equalization says the tax will raise $200 million a year, but critics claim it will raise nothing because online retailers will end their affiliate programs rather than collect the tax.

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FORTUNE - California Gov. Jerry Brown on Wednesday signed the so-called "Amazon tax" into law. The measure forces out-of-state retailers (not just Amazon) to pay taxes on sales within the state. Earlier on Wednesday, Amazon (AMZN) sent notices to its affiliates in California, warning them that if the measure became law, the company would have to terminate its contracts with them because it's the affiliates' presence in the state that makes Amazon subject to the tax. Amazon has pulled similar maneuvers in other states where such taxes were imposed.

California, like other cash-strapped state governments, is flailing about for new sources of revenue. Proponents of the tax claim it will raise $317 million in revenue a year. But California should look around at other states that have tried this tactic: it usually doesn't work out so well.

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Amazon and Overstock have severed their agreements with affiliates based in California

Answer Question
 
grlygrlz2

Asked by grlygrlz2 at 11:21 AM on Jun. 30, 2011 in Politics & Current Events

Level 39 (106,530 Credits)
Answers (21)
  • I feel like i must be missing something. It sounds like an internet sales tax to me.


    Why would it reduce small business income? Wouldn't they just pass the tax along to the consumer? Anyone doing internet business in the state of California would be paying it so it's not like people can just order thier stuff from a different retailer. I can't imagine a retailer choosing not to do business with an entire state of consumers because they have to charge them sales tax. All non-internet business charge sales tax, don't they?


    I think the state has the right to require all businesses to pay sales tax, not just brick and mortar ones.

    UpSheRises

    Answer by UpSheRises at 11:29 AM on Jun. 30, 2011

  • It's not a tax on consumers. It is a tax on companies. Other states have tried this and it hasn't worked.. Actually Lost them revenue... I have to wonder why California thinks they are so different..
    grlygrlz2

    Comment by grlygrlz2 (original poster) at 11:30 AM on Jun. 30, 2011

  • Amazon dropped California like a bad habit... and even China won't do business with my state!!! And we can thank every other state hating us because of the few whack jobs we allow to run things and pass laws? Such as those that want to ban circumcision and they should have a blue dot over their house online for being so interested in a little boys privates? We won’t even eat at a restaurant when we hit San Francisco just off how they banned happy meal toys (our kids are picky eaters so we get one on the side so we can eat somewhere nice)! We started hitting beaches to avoid even entering SF this year like Point Reyes!

    Sure those in government that have the state by the balls, are going to run it into the ground, and get to where we can’t even afford to move out of this hell hole? Our goal is to save and move!!!
    MommaClark3

    Answer by MommaClark3 at 11:32 AM on Jun. 30, 2011

  • California is a joke… they want to ban declawing a cat but allow and see nothing wrong with the old woman who had her dog fixed, than plastic surgery to give him balls again, so the dog feels like a man? Nutjobs are allowed to bring the normal people down?

    SF still boils most peoples’ blood in CA because they want to ban Christian/Jew practices like circumcision, but allow gay marriage? This sales tax thing is just another of the many things dragging down the state and making the normal people leave our state! I’ve watched really good friends move across the U.S. because California can’t do their jobs

    Now my fear is they’ll continue to pass things like this and I’ll be too broke to even afford to leave?
    MommaClark3

    Answer by MommaClark3 at 11:38 AM on Jun. 30, 2011

  • You know what? CA could fall off the map and I wouldn't care.
    It's a bad role model for more than just business.
    Anonymous

    Answer by Anonymous at 11:45 AM on Jun. 30, 2011

  • I'm sorry Mommaclark, here's to hoping you can get the heck outta there.
    But I did love what you said about the normal people leaving CA. That was my daily chuckle-thanks so much!!
    Anonymous

    Answer by Anonymous at 11:47 AM on Jun. 30, 2011

  • Our goal is to save and move!!!


    Good Luck! We have very good friends who moved there nearly 10 years ago and are fighting like hell to get out!  

    grlygrlz2

    Comment by grlygrlz2 (original poster) at 11:54 AM on Jun. 30, 2011


  • The San Jose online auction company says the legislation would hurt its business model, which relies on thousands of entrepreneurs who sell goods on its site.

    The intent may have been to go after Amazon, but “we’re literally caught in the crossfire,” said David London, senior director for state government relations at eBay.

    grlygrlz2

    Comment by grlygrlz2 (original poster) at 11:55 AM on Jun. 30, 2011

  • Oh wow! If this is what they are going to do I won't sell to residents of CA. My prices (spec needs website) are very low. There isn't room for ME to pay a tax. I suppose I will have to extend that to my ebay sales as well. That is sad.

    IMO if states want to do an internet tax they should
    A. Tax only sales to its residents
    B. Tax only sales of businesses located in the state

    California has NO jurisdication over ME or MY business.
    yourspecialkid

    Answer by yourspecialkid at 12:11 PM on Jun. 30, 2011

  • California, like other cash-strapped state governments, is flailing about for new sources of revenue. ~ from article

    Why of course they are. Apparently these cash strapped state governments aren't having any more luck than the federal government at figuring out that what they need isn't more money ... it's a budget, and someone with the ability to actually stick to it.

    If they would work to get more people working than living on welfare, stop birthing illegal babies and schooling them for free, stopped taxing the lifeblood out of hard working citizens and businesses so they can give more money to deadbeats, and stopped blowing money on every idiotic scheme and idea these state governments would have a surplus of cash. They should be pelted with cheese until they stop whining and start working for the interests of 'we the people' again.
    Farmlady09

    Answer by Farmlady09 at 12:17 PM on Jun. 30, 2011

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