Internet Sales Taxes in California
Well I might live in the "Golden State", but we sure are lacking a lot of gold right now. If you have listened to the news at all you know with the large debut in California our State is looking for money everywhere. The latest thing is to tax internet sales. If you have a "brick & mortar" store in California you'll have to pay taxes on internet sales. Ok if that is not bad enough now they are talking about if you sell anything over the internet to someone in California and you offer a service like home tech support you'd have to pay taxes as well. I'm thinking Dell and Gateway are having a hard enough time right now without having to give 8.5% of their profits over to the state just to help California get out of debut. Here's a report from around 2001 just look at these numbers:
Key Findings
Contrary to some inaccurate media reports, states are currently collecting sales taxes on the Internet, but only on purchases made from vendors that have "nexus" or substantial physical presence in the state.
Using data from the federal General Accounting Office (GAO) and a solid California econometric model called Cal-STAMP, we estimate that taxing Internet sales will immediately and permanently destroy thousands to tens of thousands of California jobs. Specifically, if California applied sales taxes to most Internet purchases this year, the state would gain $184 million in additional state sales tax revenue, but lose 45,207 jobs in 2001.
If Internet sales are taxed more broadly, more than 100,000 California jobs could be permanently destroyed by 2002. And even under the highest Internet sales projections, taxing the Internet will generate less than one-half percent (0.47 percent) of the state’s total tax revenue.
Seems simple to me, and as all you know how easy would it be for me to up and move my internet business from California. I just hope someone in the government thinks about this before we drive one of our biggest economic drives out of the state.
Key Findings
Contrary to some inaccurate media reports, states are currently collecting sales taxes on the Internet, but only on purchases made from vendors that have "nexus" or substantial physical presence in the state.
Using data from the federal General Accounting Office (GAO) and a solid California econometric model called Cal-STAMP, we estimate that taxing Internet sales will immediately and permanently destroy thousands to tens of thousands of California jobs. Specifically, if California applied sales taxes to most Internet purchases this year, the state would gain $184 million in additional state sales tax revenue, but lose 45,207 jobs in 2001.
If Internet sales are taxed more broadly, more than 100,000 California jobs could be permanently destroyed by 2002. And even under the highest Internet sales projections, taxing the Internet will generate less than one-half percent (0.47 percent) of the state’s total tax revenue.
Seems simple to me, and as all you know how easy would it be for me to up and move my internet business from California. I just hope someone in the government thinks about this before we drive one of our biggest economic drives out of the state.
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