Sales Tax Fairness Fight Heats Up in California

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As budget talks heated up in California this week, the American Booksellers Association, the Northern California Independent Booksellers Association, and the Southern California Independent Booksellers Association urged their members in the state to call Gov. Arnold Schwarzenegger’s office to express support for sales tax fairness.

The proposed state budget package includes a sales tax fairness provision that mirrors the New York State "affiliate nexus" law. If this provision goes into effect in California, online retailers will have to comply with existing law and collect state sales tax for purchases made by state residents.

"We understand that, in the past few months, we've asked quite a lot of our California bookstore members, but each step we take in this effort is crucial toward our ultimate goal – sales tax equity," said ABA CEO Oren Teicher. "Rest assured, we do not take these outreach requests lightly. We know you are busy, and this has been a long campaign, but it is imperative that our members in California take a moment to call the governor's public phone number in support of sales tax fairness. Now is the time. Every call makes a difference."

Among the key talking points for booksellers who call the governor’s office are:

  • As a retailer, you support the affiliate nexus provision in the state budget – urge the Governor to support this provision as well
  • This provision supports small and large businesses alike by requiring out-of-state retailers with nexus in the state to play by the same rules as in-state retailers, thereby taking away the significant – and unfair – advantage that out-of-state online retailers have over their in-state competitors
  • The economic impact of the current sales tax inequity on California businesses has been profound, and it is significantly affecting businesses' ability to foster job creation and continued growth
  • This is not a new tax, the affiliate nexus provision merely stipulates who is responsible for collecting and remitting the sales tax: the remote retailer or the consumer
  • New York State passed this provision in 2008 – in its first full year, it garnered $70 million in sales tax revenue that otherwise would have otherwise been lost

The phone number for the California governor’s office is (916) 445-2841. Booksellers with questions are asked to contact David Grogan, ABA's senior public policy analyst, at dave@bookweb.org or (914) 373-6662.