Poll: Should Amazon.com Customers Have to Pay Tax?

The online retailer will levy state tax on mail-order purchases beginning Sept. 15. Are you going on a shopping spree before then, or are you happy to see the change?

If you've got items sitting in your Amazon shopping cart that you've not yet purchased, you might want to consider moving into the checkout line.

As we , Friday is the last day to buy from the online retailer tax-free: Amazon will begin charging sales tax on purchases for California residents this Saturday. Sales tax in L.A. County is 8.75 percent.

Up to now, buying online at Amazon.com saved customers money, since no sales tax was collected.

But state lawmakers in California–a state which desperately needs cash–reached an agreement last year with online retailers, including Amazon, who agreed to begin collecting a sales tax in September. Those sale tax funds will be returned to the state.

According to the LA Times, about half of the projected $316 million raised in the first full year–and put into state coffers–is expected to come from merchandise sold by Amazon.

While local retailers, as we noted earlier this week, will tend to be happy with the playing field being leveled a little bit, for the web-based consumer, the change will come with a price.

So we ask you - are you a big Amazon customer?  Will this affect you?  If so, are you happy to pay the tax?  Do you think it will benefit L.A. County and California?  Please share your thoughts in the comments.

Gary Edwards September 14, 2012 at 05:08 AM
i don't buy from amazon so of course i think sales tax should be charged. esp since amazon plans to have a shipping ctr in calif. gotta pay to play! still, suckramento will find a way to screw up the taxes received. no doubt it will go to general fund and out the door. too bad for schools.
navigio September 14, 2012 at 03:04 PM
Amazing. Technically, consumers already owe sales tax on online purchases, its just that vendors are not the one who have to collect it, rather consumers are required to report the items and pay the tax on them themselves. So this change only really constitutes a change for people who are currently breaking the law. cough, cough.. :-)
Carole Curran September 14, 2012 at 03:35 PM
Sales Tax should apply on purchases made in CA from CA vendors only. The tax rate charged is where the goods exchange hands (ship to address). However, according to the SBOE, if the product is shipped from outside of CA, no tax should be due. The state's portion is one part of the rate, counties and even cities can levy a percentage, making the sales tax rates different in each location (check out El Monte rate sometime). If an item purchased on Amazon from Illinois is taxed at the California rate, that isn't right. If the tax is a flat rate, then the counties/cities will not be getting their share. This should be most interesting.
navigio September 14, 2012 at 03:54 PM
Yes, you're right. Tried to keep it too brief. The tax in this case is no longer called a sales tax rather a use tax.
Terry September 14, 2012 at 04:03 PM
A lot of items listed on Amazon.com aren't shipped from Amazon's warehouses, but from independent sellers, many of which aren't located in CA. If I bought from one of these sellers, would I have to pay CA sales tax too? I hope not.
George Y September 14, 2012 at 04:14 PM
California residents will do what it takes to avoid paying taxes which has created a bit of a boom for out of state merchants at the expense of local business. We cringe at the thought of paying increased income taxes even though we ignore that part on our state income tax form that asks us about our out of state (on-line) purchases.This law will simplify tax collection of what we were already legally responsible for. It takes money to pay for the services we expect and depend on.
Leslie M Wilkins September 14, 2012 at 04:36 PM
I am a frequent Amazon shopper but over the years things have sure changed. Now I make one order for several items but they arrive from separate vendors with various shipping charges. I used to be able to bundle items to qualify for free shipping - not anymore. With the imposition of the "use tax" and the difficulty getting free shipping. I will be checking E-Bay more. Many products I shop for are available from their on-line stores. But...I shop locally when ever possible - love you Altadena Hardware !!
Albert G September 14, 2012 at 05:07 PM
The tax doesn't bother me if it could alleviate our state's debt but sadly, I have the feeling it will only be used towards pay raises for state politicians and employees.
navigio September 14, 2012 at 05:57 PM
BK, then you should stop paying income tax too..
navigio September 14, 2012 at 08:21 PM
sorry, perhaps something a bit more productive.. :-) here is a great article on the impact of this misunderstanding (and why its probably more effective to convince vendors to do the work): http://www.governing.com/blogs/by-the-numbers/state-use-tax-collection-revenues.html also note the impact on california revenues..
navigio September 14, 2012 at 09:25 PM
That approx $4B loss in state revenues outlined above represents about $2B loss for public education (given that sales/use taxes are general fund revenues). Here is also a great overview on the different types of general fund revenues and how they have changed over the past 10 years or so. The last two graphs are particularly revealing wrt the public discourse about our actual tax 'burden'.. http://www.sco.ca.gov/state_finances_101_state_taxes.html $2B/year, while not the cure-all, would have made up for the state general fund portion of the public education revenue cuts over the 07-08 to 09-10 period. http://www.edsource.org/data-k12-education-revenues-dropped-2008-09.html it wouldnt have done much to what's likely to happen this year..
Laura Monteros September 14, 2012 at 09:35 PM
Most of us didn't realize until recently that we were breaking the law, and with all the additional county sales taxes, it would be difficult to figure exactly how much we owe the state. I am all for paying the taxes I owe. No, I don't like the added cost, but I do like the services I get. Since Amazon plans to open a brick-and-mortar distribution center in California once they start adding on sales tax, we will benefit from faster delivery, so there is an offset.
Albert G September 14, 2012 at 09:44 PM
That was my reaction to a NEW tax, never before imposed. I am resigned to the existing taxes.
navigio September 14, 2012 at 10:36 PM
:-) Yes, I know. My snarkiness was intended to point out that it is in fact not a new tax.
Albert G September 14, 2012 at 11:15 PM
Not to put too fine a point on it, but since I've ordered from Amazon.com for at least 10 years and never paid a sales tax, it's pretty much a new tax for me :)
Jill Pyeatt September 15, 2012 at 06:59 AM
This is disgusting. Do the Powers That Be want people to spend money to keep the economy going, or not?
Albert G September 15, 2012 at 03:10 PM
Apparently "not", Jill :( It seems if they can find a new way to squeeze the last dime out of the middle class, they will.
navigio September 15, 2012 at 05:47 PM
funny. may I remind people that the powers that be are the people? 'the limits of tyrants are defined by the endurance of those they oppress.' (-fd). regardless, we have an initiative process in this state; for better or for worse. if anyone bothered to look at the graphs in some of the 'reports' linked to above they might have noticed a 25% decrease in general fund income tax burden in our state in the past decade. not much 'squeezing' going on there. add to that the 'offshoring' of our sales tax burden by online buying'. CA has the eighth largest economy in the world. Yes the world. Somehow all this anti-business and depressive tax policy hasnt prohibited that from happening. And CA has essentially the worst-funded and worst-staffed public education system in the nation (anyone who is looking for a definition of disgusting needed look much further than that). That should REALLY bother anyone who truly cares about our economy.


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