I recently sent a letter to the editor of the Long Beach Press Telegram in response to an editoral they published called “Online Sales Should be Taxed”. The editorial’s position was that we needed a law to make online retailers collect tax to make it fair for offline retailers.
The editorial board obiviously does not know what it’s talking about and has fallen prey to Walmart et al lobbying efforts, just like the Democrats in Sacramento.
Below is the full letter to the editor. The bold parts were edited out, much to my disappointment. I guess that’s what happens when big media wants to censor the public.
For your information, online sales ARE taxed already. Every good sold
in California that is subject to sales tax is already taxed whether it
is sold online or in stores. All Californian’s are responsible for
paying the sales tax regardless of how they purchased the goods.
The issue is the State’s ability to force retailers to collect taxes.
For retailers with a physical presence in California, the state
government forces retailers to do the State’s job of collecting the
sales tax. That uncompensated tax collection burden applies to both
retail store operators and online stores operated by companies that
have a physical presence in California. Just try buying something
from Walmart.com and they will collect sales tax from you.
It is unconstitutional for the State to force retailers who do not
have a physical presence in the state to do the State’s job of
collecting taxes. . In Quill Corps. v. North Dakota, the Supreme Court
ruled that a business must have a physical presence in a state for
that state to require it to collect sales taxes.
Our State representatives are trying to create physical presence,
where one does not exist, to force out of state retailers to do the
State’s tax collection work. The way they are doing that is by saying
that if an independent publisher or marketer based in California
promotes the out of state retailer’s products and gets a commission
then the retailer has to collect taxes. Its like saying that because
Amazon ran a pay for performance ad in the Press Telegram they are now
based in California and can be forced to collect taxes.
If the law passes, out of state retailers will discontinue
relationships with an estimated 25,000 businesses in California to
avoid being forced to collect sales tax. That will mean we don’t get
the sales taxes and that lots of tax paying Californian’s will lose
their jobs and livelihood. We will end up with fewer jobs and the
loss of of income tax receipts. It’s a lose, lose proposition.
The only constitutional solution is to have the Federal government
pass a law to make it happen.