News


State sales tax dropped by 1% yesterday

New law rules that all online retailers now have to collect it

The statewide sales and use tax rate decreased by a full percentage point yesterday, July 1.

But at the same time, a new state law took effect that requires out-of-state retailers to collect sales taxes on purchases made by California customers. The new law particularly affects amazon.com, which up to now has not charged sales taxes on its online purchases made here.

The statewide sales and use tax rate decreased from 8.25 percent to 7.25%. The 1% decrease applies, generally, to all taxable transactions in California. In areas where voters have approved additional sales taxes, the total tax rate applied to purchases will be the statewide base tax rate of 7.25%, plus any applicable local sales tax.

As part of a 2008-09 budget agreement, the state Legislature temporarily increased the General Fund portion of the sales and use tax rate by 1% in April 2009, with the increase to expire at midnight June 30, 2011.

Betty T. Yee, a member of the state Board of Equalization, said the sales and use tax rate in California has ranged from 8.25% to 10.75%, depending on whether additional regional voter-approved sales taxes appled. Now the range is 7.25% to 9.75%.

It's unclear as to how the Legislature's action in mandating sales taxes for all online purchases will affect California. State officials said the new tax collection requirement — part of budget-related legislation — is expected to raise an estimated $317 million a year in new state and local government revenue.

But the new requirement applies only to online sellers based out of state that have some connection to California, such as workers, warehouses or offices here. Both Amazon in Seattle and Overstock in Salt Lake City have told affiliates that they would have to move to another state if they want to continue earning commissions for referring customers.

Many of about 25,000 affiliates in California, especially larger ones with dozens of employees, are likely to leave the state, Rebecca Madigan, executive director of trade group Performance Marketing Association, told the Los Angeles Times. The affiliates combined paid $152 million in state income taxes last year, she pointed out.

Comments

Posted by resident, a resident of Another Pleasanton neighborhood
on Jun 30, 2011 at 8:09 am

Yes!


Posted by Elaine, a resident of Ruby Hill
on Jun 30, 2011 at 8:44 am

YEA! It's about time!!


Posted by Pepper, a resident of Old Towne
on Jun 30, 2011 at 9:49 am

So, what will it be now here in Alameathead County?


Posted by Member, a resident of Amador Valley High School
on Jun 30, 2011 at 9:51 am

The main part of the story is a nice tax reduction for us.
The other part of the story (regarding Amazon) shows how business is driven away from a state by taxes. The last paragraph of the story talks about how CA plans to change tax aspects for Amazon, so Amazon will move 25,000 to another state. Those people were accounting for $152,000,000 of tax revenue last year.
So as the bureaucrats do something that they foolishly and simple-mindedly think will increase tax revenues by increasing a tax rate structure, the real result will be a loss of tax revenue.


Posted by house owner, a resident of Mohr Park
on Jun 30, 2011 at 10:47 am

I'll have to pay more to amazon for purchase online or CA will loose income if Amazon moves away. Neither one is good.


Posted by Erika, a resident of Vintage Hills Elementary School
on Jun 30, 2011 at 11:01 am

Sales tax in Pleasanton will go down from 9.75 to 8.75%


Posted by check receipts, a resident of Another Pleasanton neighborhood
on Jun 30, 2011 at 11:47 am

Check your receipts to make sure you are being charged the correct rate


Posted by RestOfStory, a resident of Amador Estates
on Jun 30, 2011 at 11:58 am

Purchases through Amazon.com will continue to be tax free. All its California-based affiliates were informed that as of yesterday (when Brown signed this legislation) their relationship with Amazon was terminated. Amazon did the same thing in New York in response to similar legislation. The result of this empty effort is that California will not collect one more dime of sales tax, many small marketers will take their business outside California, and what sales and income tax those companies previously paid will vanish. Employees of these companies will also loose their jobs. Nice move Democrats! The only positive outcome out of this is that there will be a few less residents in the state and the undersized freeway system will be a little less congested.


Posted by OtherTaxCuts, a resident of Canyon Oaks
on Jun 30, 2011 at 12:04 pm

In addition to the return of the sales tax to its previous level, your car tax (Vehicle License Fee) will be nearly cut in half. However, the Democrats did institute an increase in "fees" ($12, I believe). Also expiring, as of Dec. 31, 2010 are the two other 2009 tax hikes (0.25% state income tax hike and slashing $200 per child or adult from the state dependent tax credit).


Posted by Leland, a resident of Happy Valley
on Jun 30, 2011 at 12:05 pm

Any extra money I get from tax reductions is great. If people want to move from California to Idaho or Tennessee, that's fine with me. More space for me. Goody!


Posted by YourPunishment, a resident of California Reflections
on Jun 30, 2011 at 12:11 pm

This so-called "austerity budget" administers its cuts where you will feel the pain. The Democrats refused to cut the structural waste and are cutting valued services instead. For example, 70 parks will be closed. This "public punishment" demonstrates the vise grip that the government unions and the resulting entrenched bureaucracy have on California state government. Instead of demanding efficiency and frugality and wisdom and an end to disgusting waste, fraud, inefficiency, duplication, and harmful social programs, the Democrat politicians have loyally refused to bite the hand that feeds them and gets them reelected each year. (Most of the campaign contributions to Democrat politicians are from wealthy government unions). This is a spirit of stealing and taking away what you already paid for. Cutting legitimate services will hurt the economy too.

Come November, we will face a tax increase on the ballot. If we refuse to give them more money, they will make major cuts in the funds going to schools. That will certainly educate the tax payers in this state! I hope that they remember their lessons come election time.


Posted by George, a resident of Happy Valley
on Jun 30, 2011 at 1:28 pm

Seems like substantial numbers of CA jobs will move elsewhere, along with the state/local income taxes they generate.
Consumers will have to pay more for goods.
You know if government did collect more money, it would all be wasted on bigger expense accounts, more trips for 'meetings' in Hawaii, bigger government pensions.
Maybe we can buy more things directly from China to compensate.
I'll be shopping elsewhere first, CA last.


Posted by Boner, a resident of Another Pleasanton neighborhood
on Jun 30, 2011 at 3:57 pm

Your Punishment,

That tax increase initiative on the ballot in November you are talking about, will it require 66.7% to pass? If so, I think it might be DOA.


Posted by Mike Evans, a resident of another community
on Jun 30, 2011 at 10:44 pm

Keep the sales tax increase (only 1%) and add a gasoline tax. Stupid to force on line retailers to collect tax. We lose $157 million plus the jobs associated with 25,000 businesses!!! Dumb state senate/assembly/governor!!


Posted by Leland, a resident of Happy Valley
on Jul 1, 2011 at 5:48 am

I love the tax reduction and the elimination of the tax on wealthy. I get more money, and Cal State students this year will have to fork over an additional 23% in tuitions and fees, and get less for their money with teacher lay-offs and course reductions. Meanwhile, me and the wife plan on using this windfall to travel to New Zealand and spend our newly acquired money over there. Thank God the Republicans had the guts to get me my vacation money at the expense of students. Don't you love it? Higher student tuitions is as it should be. After all, the rich should have an easier educational time than poor people don't ya think? We deserve it because, well, we're wealthy.


Posted by Jeanne W., a resident of Pleasanton Valley
on Jul 1, 2011 at 8:17 pm

We went to TOMO for dinner today, and the sale tax is still 9.75% on the receipt. I asked a waitress about it, and she said the owner hasn't got any notice for the change from City.
I thought they must know it.
I don't know i I can get money back from them although it's 1%.


Posted by Leland, a resident of Happy Valley
on Jul 2, 2011 at 6:15 am

(Comment removed by Pleasanton Weekly Online staff for containing unverified or personal information.)


If you were a member and logged in you could track comments from this story.

Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: *

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

The Gay Rights Movement Coming of Age
By Tom Cushing | 32 comments | 1,225 views

Hacienda Business Park evolves to meet demand
By Tim Hunt | 0 comments | 1,024 views

A Norman Rockwell Town
By Roz Rogoff | 6 comments | 1,016 views