(October 24, 2011) Hear the audio version
Remember when online shopping began, back in the last century? What convenience! No more having to schlep to the mall in the rain, or search for a parking place on El Camino Real. With a click and a credit card, we had what we wanted delivered to our doorstep. Even better, there was no sales tax! That newfangled books site up in Washington State, as well as scores of now-defunct dot-coms argued “This is new. Give it a chance. Don’t impose a tax.”
In 1992 the Supreme Court ruled that a business must have a physical presence in the state in order to be required to collect sales tax. But Amazon, that Washington State book/now-everything gargantuan online retailer, has acquired “affiliates” in California and other states. Because online shopping has matured.
And it should be taxed. It isn’t fair to other retailers that online merchants can offer what is essentially an across-the-board discount by not charging sales tax.
I say that as an author and publisher who now sells books online. When I sold physical copies of my books, I held a California State resale license and collected and paid state sales tax.
Now my eBook is being sold online tax-free. I don’t like that. The issue of taxing Internet sales is in limbo, after California struck a deal with Amazon to postpone collecting sales tax until next September. That gives Amazon, traditional retailers and Congress time to work together to pass a federal online sales tax law. Two bills have already been introduced, including, most recently, the Marketplace Equity Act co-sponsored by Peninsula Democrat Jackie Speier. I wish her and her Republican co-sponsor all the best getting even a level-the-playing-field tax bill passed by the current Congress.
In the meantime, I’ll be voluntarily contributing 8.25% of my sales to my local school district. And I encourage other online sellers to choose their worthiest public beneficiaries—state parks, libraries, whatever. Because it’s not often we get to designate where our “taxes” go.
With a Perspective, I’m Debbie Duncan.