Amazon, Overstock Flee California in Wake of New Tax Law

This is a legitimate form of tax revenue, and Amazon should pay it. Governments are being asked to do more with less at every turn, services are being slashed, and employees laid off. The public doesn't want to see their own tax bills go up. So what's left? Ensuring that tax laws for multi-state, private-sector corporations are applied evenly -- regardless of whether their sales are derlived in the physical or virtual spheres.

We should not pay any sale tax period. The politician and others rob us from our happiness. They use the sale-tax money for their pet projects; that's the fact, we don't need sale tax in California, the state already is collecting fees on goods, services, licenses and other charges imposing by the State of California. What about property tax, where all this money is going to? It is unjust for all residents and citizens in the United States of America. Why we don't have an election about the sale-tax? Why Portland, OR do not have any sale-tax: and people live there in Portland very happy? To enforce any sale-tax in California and other states in unjust! Think about it!

Mr. Davis makes some very good points but I believe the facts or on the side of Amazon and Overstock. What California is doing is unconstitutional. If the law as it is currently written is not fair then the law should be changed but states should not be able to tax businesses in violation of the law just because the state needs more money.

If I (the purchaser) was physically in California when I made a purchase I would expect to pay applicable taxes. If I am NOT physically in California and make an online purchase then I would NOT expect to pay taxes. Whether it is Amazon or any other company remote sales SHOULD NOT be taxed. That is the attraction for me to buy online. Otherwise I will just buy locally in my home state and California (or any other state) looses my business altogether. No commerce benefits at all!!

I already pay state and federal income tax, in addition to property tax. My money is taxed when I earn it, when I try to save it and then when I try to spend it. Why should I have to pay any kind of sales tax? The sales tax is just another way to the already over-taxed citizen. Why do you think we shop at amazon in hte first place? It is because we don't have enough money left after all the taxes we pay to begin with.

This really has nothing to do with paying sales tax and more to do with wal-mart being mad that amazon has an advantage over it. What's funny, was years ago when wal-mart was putting mom and pop stores out of business cause they had lower prices, wal-mart was saying that it's the future and to deal with it as all the smaller stores shut down cause they couldn't compete... now that wal-mart is on the receiving end, suddenly it's an unfair playing field and they're crying foul? seriously? Well you know what wal-mart, onlines stores are the future, why don't YOU try to deal with it, just like you told the mom-and-pop stores that you put out of business.

I applaud Amazon for their decision to leave California. I left California for the same reason, tax, welfare, tax, welfare. If California wants to drive away businesses that is their choice. They already have a structure in place to facilitate the next 25,000 people this action will cause to enter unemployment.

Tax without representation... hmmm.. sounds familiar. Calif. needs to reconsider other revenue options or play the lottery. We tax payers are feeling the pinch.

What is not addressed is if Amazon charges the sales taxa, they have to add additional accounting personnel and then pay the tax. This is NOT economic stimulus, it is punitive for ANY business to collect taxes for the states/local entities. And income is pinches with income, social security, medicare, gas, property, inheritance, use, etc. etc. etc taxes, then adding more is stupid. When will our elected officials AND their bureacrats begin to tighten the belts and eliminate programs. We have become a society that is no longer able to be independent - we expect "government" to do everything. Remember that we used to have government of the people, meaning we "is" the government!

Citizens should not have to pay sales taxes on out of state purchases. Sales taxes are to build and support infrastructure used by the businesses in the state (roads, gov't office buildings, parks, law enforcement, courts, etc.) Without brick & mortar, Amazon is using none. Shipping costs, whether paid by the customer or Amazon are added costs that are usually more than any sales taxes and wipe out competitive advantage for mail orders. Delivery services in the state pay road use taxes, property taxes, etc. since they are brick & mortar and do use the infrastructure. Just another tax for the state to collect & blow!

What's not fair is the typical duck and cover when it comes to corporations paying their fair share in taxes. It's always the average American that faces the burden while the corporations are able to hide from their fiscal responsibilities. It would be beneficial if corporations would do the right thing then our governments wouldn't be forced to cut benefits for those who need it, could put construction workers back to work, wouldn't have to close parks or cut government services for the poor or seniors. We're all being fleeced by corporate America who used to do the right thing years ago, but now try to find every way to cheat the system. Interesting article on this: http://blog.cagle.com/2011/06/america-needs-taxes/

There are no Governments that are starving! Absolutely ignorant statement. Yes there have been cuts - It is essential that we reduce the unsustainable budgets and budget increases that have occurred for the last 30 years. The problem is, that the demoncrats will only allow cuts in government that they know will affect job growth and economic success. They stymie every effort to cut entitlements and payouts to the welfare pigs.

G-bob has it right, it depends on the location of the purchaser, not the seller. An Oregon resident can shop in Washington state and NOT pay sales tax by proving they live in Oregon (showing drivers licence for example.) Imposing a tax because the seller is in California is akin to imposing a tariff for commerce to move between states, something we as a country eliminated a couple centuries ago.

As a California resident, living in a state that has abused the budget process for decades (we have been here before) and where 12 percent of the residents are "officially" unemployed, we won't go into the "un-official" numbers, Amazon and other on-line retailers offer the populace an opportunity to save money. Why shouldn't Californians be afforded the same benefit as residents of other states? Why must I pay taxes on "everything"?

The government greed never stops. We citizens are only sources of revenue for the venal politicians who never tire of spending other people's money. I could give you a more reasoned argument but it essentially boils down to this.

It never ceases to amaze me how ill-informed people are about taxes in general and sales tax in particular. For those who don't want to pay any tax whatsoever, what would this country look like if there were no police, no fire protection, no public schools, no roads, the list goes on. Am I to believe you would be able to provide for yourself and each person/family would be on their own? Taxes are the price we pay to maintain some order and civility. I understand that no one likes to pay taxes and we can argue about how our tax dollars are used and what they should or shouldn't be used for. In this case, why should an online retailer have a competitive advantage over a brick and mortar store solely because they are online? The sales tax laws are generally written so that the sale is what's taxable based on the location of the purchaser. The Amazons and Overtocks of the world collect no local property taxes or sales tax even though by law (in most states) they would be required to do so. Sure, it's great for the consumer in the short term, but in the long term, your local community suffers because if you make the purchase online without paying the tax, you lose the benefit of the tax dollars being spent in your local community or state which increases the pressure to raise taxes or make cuts and reduction in services. I have no problem with a reduction in services but the decision should be based on what role government should play as opposed to a scheme to avoid paying taxes.

I agree John, we should not pay any taxes at all. Then we can provide our own police and firefighters to protect our homes and property. Now we move to the roads which allow commerce. We pay for our portion of the street to be maintained. How about the sewers? water distribution? or maybe you forget that taxes pay for the aggregrate infrastructure you enjoy but do not want to pay for. Speak about a free ride!

Since Prop 13 went through California has declined due to loss of revenue. Let's tax the corporations and charge for our natural resources as well. Is it fair that GE paid $0 in taxes last year? How much did you pay?

The accounting is straight forward, you set up another line to the ledger and at the quarter you submit the amount to the states. Not hard since the accounting is not done by hand but automated. Amazon relies on the states infrastructure to deliver its goods when it isn't acting as a middleman. Let's end the free ride for the poor corporations.

How do you get the goods? Do you pick them up? No, they are delivered using the infrastructure you described.

It isn't what you pay in taxes but the return on that money. My sister lives in Sweden and pays about 61% in taxes but healthcare, maternity leave, education including college, unemployment is all included. We compared our costs to hers and we paid 67.3% due to all the other added insurances and educational costs. It comes down to bang for the buck!

What would you give up to lower the taxes?

Finally! Someone who sees the light!

No amount of taxation revenue will be sufficient for the yawning void that is Calif government. If they found a way to tax at 100%, there'd still be massive budget deficits. The mantra of government is "we're just one tax hike away from general prosperity for all" and if you don't like the apple they dangle in front of you, you are accused of putting police and firefighters out of work and letting children starve.

Dutch, First of all, our local school taxes, state college, and fire protection I know for a fact come out of our primary and secondary property taxes. I am thinking perhaps police protection comes out of the primary property taxes and our state income taxes. Okay, so there goes that theory. Sales taxes are a slush fund for bloated city manager and county supervisor salaries, as well as state managers. The grunts don't see much other than pay cuts and contribution increases here. You can't tell me that WalMart has suffered ANY from Amazon. As a matter of fact, if anything, the small retailer affiliates that Amazon works with are the bread and butter of America. They are the little guy that those giant "big box" retailers have put out of business in America, and they don't appreciate the competition of Amazon giving the little guy a chance to work for himself. I say NO ONLINE SALES TAX. Those people providing the products have ALREADY PAID sales taxes when they purchase the products. Its just more greed looking to double the take.

Yep, Sweden, leaders of the entitlement theory - free apartments for drug addicts so they give the appearance of a wholesome society and can hide them off the streets. Amsterdam is regretting some of their socialist decisions now too. No - I DON'T intend to pay 61% of my salary in taxes so the lazy derelicts in this once great nation can sit on their butts and benefit from my hard work.

Lisa, I'm not sure where you live but where I live, primary funding for schools come from property taxes however that doesn't provide all of the funding. Since police protection comes from municipal government, some of the property tax revenues also pay for that but so does the income tax distribution the city receives from the state and so does their local sales tax revenues and any other city tax revenues. I'm not sure why you think that does anything to my "theory". A local store, whether it be a small retailer or a big box store pays local property taxes and collects sales tax that goes back to the city. I have no sympathy for Walmart. I have more sympathy for the small, independent local retailer who not only faces cutthroat competition from the Walmarts of the world but also from the online retailer who doesn't collect sales tax when a sale is made to a resident of the community where the independent retailer is located and who may offer the exact same product purchased online. The independent retailer is paying property taxes, collecting sales tax and probably sponsoring Little League teams along with other community involvement activities. I haven't seen that from Amazon or Overstock. They don't have a vested interest in your community. So if the independent retailer goes out of business, there is less sales tax collected and less property tax paid (unless some other business moves into the now abandoned building), there is more blight in the community and increased pressure to find other revenues or cut services/spending. I'm not sure there is any perfect tax and sales tax is far from perfect.

Oh, those poor multi-national corporations suffering from Amazon's not charging sales tax. Considering all of the government subsidies, urban renewal payments, and redevelopment funds (all paid by you, the sucker taxpayer) that everyone from Wal-Mart through shopping center owners and developers have received, you'd think that the state of California could be a wee bit less hypocritical. I don't recall snivelling about the unfairness of it all when Gilroy gave Wal-Mart a big, fat subsidy. Besides, has anyone else noticed that the reason people will pay $20 shipping on a $45 item is that the item purchased online is likely not available at any local vendor? Compared to shipping costs, sales tax is a non-starter. In any event, there should be NO sales taxes, user fees, or any other tax or fee that is not collected one week before the general election. I suspect if people actually saw the total bill immediately before an election, there might be a significant drop in taxes and in subsidies to both businesses and illegal aliens.

What would I give up for lower taxes? Hmmm.... Any benefit or entitlement given to illegal aliens or their children, US citizen or not. Subsidies given to stores, developers, and others through so-called "redevelopment" or "urban renewal"programs. Let's get rid of the laws against victimless crimes. I suspect that if drugs were decriminalized, the average junkie could support their habit working fast food. The cost of treatment for those who might be willing to come forward then would be far less than the fortune spent on prisons. Let's make the state employees and legislators have 401(K)s or contribute toward their pensions like everyone else. No more spiking, no more out at age 55 or less. Let's quit giving politicians pensions and extravagant salaries. I think that putting them on the regular state employee insurance plan (which state employees should also contribute towards, like the rest of us) and paying them the average wage in the state might get their attention. There are all sorts of perquisites that could be abolished. Just tonight I noticed that a Cal-Trans vehicle was being used for personal purposes over where the kids softball league is playing. Why is this wear and tear being charged to the taxpayers?

The last time I checked, 15% of property taxes state wide were going to subsidize private businesses and developers via "Redevelopment." The last time I checked education funding was down, while subsidies for illegal aliens and their off spring were rising, and the prison guards and other state employees continue to have enormous pensions and a huge unfunded pension liability looms over the state. I feel reassured that while financial aid for US citizen and legal residents is being reduced while tuition rises, the state legislature has seen fit to give grants to illegal aliens who wish to attend college. Your mileage may vary. B>(

This article is lacking some vital information. Outside of a single quote from Amazon; where is the information on the unconstitutionality of the California Bill?

Well said Sherry

The best point I have seen so far.

Doug! Corporations don't pay any taxes! Taxes are just a cost of business passed on to us the consumer. So, in other words, you want to tax yourself and your neighbor for the State's out of control spending. IF California can't pay it's bills, then it should cut it's spending like the common wage earner has to.

It will not be long before Sweden is like Greece or Portugal. Government can never beat the return on money that private capitalist industry provides. I do not know how you got 67.3%, but the Tax Foundation has the average Income Tax Payer paying 12.24% ( http://www.taxfoundation.org/news/show/250.html ), it is very hard to believe all other taxes total 55%.

NH has NO sales and NO income tax. Amazon and Overstock should go to NH.

I entirely disagree. we should only pay sales tax and remove the income tax and all other forms of tax.

Actally G-Bob, if you are not a resident of California, the law would not apply to you and would not require Amazon.com to charge you sales tax. The new CA law says that Amazon.com is to charge CA Sales tax to California residents only. If you are not a resident of California and you're not shipping your item to California, then you won't be charged the California sales tax.

The Bottom-Line here are the Politicians...they are solely "responsible" for the state of affairs of our State and Nation, but it's the taxpayers who always pay the price. When are they going to take responsibility for their actions and STOP making us struggle? Now Gov. Brown who decided to take on this challenge of the state of affairs in California is now taking away our freedom to purchase items that many of us do not wish to purchase in these "big box" stores, even if the merchandise is available.

I like Doug's idea except for 1 big problem: California has overregulated most of its natural resources right out of the marketplace. The only rare earth mine in the US was closed to protect a turtle from vehicle traffic. They are not doing offshore drilling for fear of a spill. And so on. So there are not really many naturar resources to tax on. If the Californians get too greedy and start taxing all over agricultural produce then other markets will fill the gap and their farmers will be beyond up a creek. I understand that their no cage egg rules have already pretty well shut down their poultry industry. Maybe they need to start taxing welfare recipients for the babies that they have while on welfare! That way they can avoid worldwide market pressures.

Why make companies collect the tax? Why not do as Utah has done and require the buyer to pay their taxes directly to the state where the product will be used? For those who fail to pay their taxes a visit by the state's SWAT goons will get them back into line! LOL

Hey here is a good sneaky way to get more tax money: Charge income tax based on where a person lives, works AND where the employer's main office is located. We could even charge income taxes on ALL employees of a company if the company has a presence in a state! That way if you work for Walmart you could pay California income taxes if the store where you work is in California AND Arkansas income taxes since the company is operating out of that state AND the other 48 states, and 4 territories since they have a presence there too. The same for Federal employees! There has already beed case law on this issue with a worker in Kentuckey who did not want to pay New York income taxes on his job in Kentucky, but because his employer was domiciled in New York the courts held that he had to pay the New York tax (in addition to his Kentucky taxes). He lived and worked in Kentucky. He did not just work some days there and some days in New York.

I'm a little late to the party but here is an idea. How about EVERYONE pay some taxes. 48% of the population pay noting. They may have income taxes taken out of checks but then they get that and more back when they file with the IRS at the end of the year. How about the lowest earners (this includes those on welfare) pay at least $100 a year and then it goes up from their. Think of how much that could help our countries deficent problem. Talk about shared sacrifice! Then EVERYONE would have some skin in the game and maybe people would start to realize you can't just keep spending money and creating new programs to spend money you don't have.

Revenues do not spontaniously materialize. Too bad!!!

Well, The shoe is on the other foot this time as far as wal-mart is concerned,

The companies delivering the purchases pay taxes for use of that infrastructure. Let's be honest, the real reason people buy over the internet is availability. I don't have to drive all over the place shopping for what I want and when I find it I can get it in sizes and colors the stores don't carry. If they do I buy there. I have purchased computers from Amazon and from the Best Buy just down the street after checking out Office Depot and Sam's on the way home. No extra driving required and I did pay sales tax. The point is convenience, availability and price are only parts of the buying decision. I don't expect companies from out of state to pay for services in my state. Texas made this same mistake earlier this year and it ended up costing people jobs. Bad decision by Texas and bad decision by California.

I can't belive some of the comments here---yes, there is waste in government (just as there is waste in corporate America---its called human beings), but how do any of you expect the government to pay for all of the services that "we" citizens take for granted and only complain about when they are gone (police, fire, education, roads, air protection, births, deaths, ---I am being very general here, but the list is long). I am a big Amazon consumer, but quite frankly, they should have been paying this tax a long time ago.