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Amazon, other tax foes launch new committee

By Josh Richman
Thursday, July 28th, 2011 at 3:30 pm in ballot measures, taxes.

Opponents of the state’s new internet tax law rolled out their new committee Thursday that will work to put a repeal measure on next year’s ballot and get it passed.

The “More Jobs Not Taxes” committee actually filed its statement of organization July 20 and has not yet reported receiving any funding, but its website says it will have major funding from online retail giant Amazon, and you can bet it’ll be major indeed.

“With state unemployment over 11 percent and companies moving to business-friendly states like Arizona and Nevada, Californians have had it with Sacramento politicians passing new tax laws that hurt the state’s economy instead of focusing on creating jobs,” Marc Duerr, the California Business Alliance’s legislative services director, said in the new committee’s news release. “This new tax law will come at the expense of California taxpayers who will be forced to pay even more to fuel the politicians’ wasteful spending.”

Performance Marketing Association Executive Director Rebecca Madigan said her group “believes Californians should have a voice and a choice on the harmful new tax law that will cost the state jobs and investment. We are encouraged at the overwhelming response to the efforts of the More Jobs Not Taxes referendum campaign and remain confident that it will collect more than enough signatures to place this measure on the ballot.”

The committee has until Sept. 27 to gather valid signatures from at least 504,760 registered voters in order to put the repeal measure on the June 2012 ballot.

Federal law says states can tax sales only if the seller has a physical presence in the state. California sought to get past that issue by letting the state tax board collect from any retailer with a so-called business “nexus” or connection with an affiliate inside California. Supporters say it would make the tax code fairer, forcing Internet retailers to collect taxes just as brick-and-mortar stores already do. Several other states have enacted similar statutes.

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  • Val Morehouse

    Responding to Josh Richmond’s article “Amazon, other tax foes launch new committee”–neighbors, this proposed measure is the “Bully in your Ballot Box”. At my local Trader Joe’s in Concord, an aggressive petition solicitor offered me and everyone else at the door, the worst example of referendum misrepresentation i’ve seen in a long time: in fact he lied, “Sign here! Stop the tax on the internet!” As a librarian, a former League of Women Voters Voter Service Chair, suopporter of the internet, and the daughter of a small businessman, i decided to check it out. Under questioning, the petition jockey revealed that, yes, out-of-state Amazon, a multi-million dollar behemoth in the book business, and now, everything else, was the huge bucks behind the ballot measure. What’s next? A title called: How to Screw Every City, County, and State in the California out of a fair tax Share? Amazon’s genius is delivery: it’s underbelly is an attitude toward customers that institutionalizes the corporate brush (just try to get them on the phone personally about a problem). Not to mention the willingness to shake down California big time. Call it the Enron formula:let’s stick to California top to bottom, including Amazon’s own mom-and-pop California affiliates. Yep. Amazon cut them off the very same week they launched this! Meanwhile Amazon keeps milking California for millions without contributing even a fair share to maintain general good in this hard hit state…sort of like a live-in boyfriend who never pays his way, but tries to claim he’s just, er, gonna visit for the night! R-r-r-right. Take action, people. Expose this multi-million dollar tax rip-off for what it is, a fraud. Above all, don’t sign their so-called petition.

  • Sign Me Up

    With all due respect, taxing the Internet is exactly what the proposal does. And do you know who is behind the effort for this bill? Wal-Mart. So spare us the rhetoric about this being a big guy vs. little guy battle. And Amazon DOES pay plenty of taxes to California: all of its affiliates are California businesses that pay business taxes and property taxes. And all those trucks that deliver Amazon books are paying gas taxes. This bill is another effort by our Legislature to tax everything that moves instead of addressing the real issue of tax reform.

  • Luan Huynh

    This is about big businesses. Amazon wants maximum profit. Is that surprising? The little business that exist in California support taxing Amazon because purchases made on Amazon has not been taxed and thus, is sometimes cheaper for California purchaser. This comes at a cost to the states, and to small businesses. The question is why should sales tax be paid when buying something in state versus buying it on the internet. I do not see the equity. Amazon should be taxed because the state needs revenues. Amazon should also be very careful about how it flexes it’s big muscle. I, for one, am on a boycott of Amazon – which I used in the past and which I love using – because I am disgusted by its antics. So, if Amazon doesn’t want to do business in California, fine. There’s many options as to whom I purchase items from.

  • Elwood

    “Amazon should be taxed because the state needs revenues.”

    Oh,bullpucky! That is exactly why Amazon should not be taxed. The greedy pigs of Sacramento are desperate for any source of revenue to fill their trough.

    Hopefully, if we starve the bastards, they’ll wither and blow away.

  • Val Morehouse

    RE: Sign Me Up’s comment above…Wal-Mart pays? I’m good with that. So if they want to help California level the playing field, I’m good with that. What isn’t good is the fraud being perpetuated on potential voters by these dishonest signature gatherers on Amazon’s behalf. Think again Sign-Me-Up. Amazon dumped all of its CA affilitates when corporate big daddy filed this petition. How’s that for polishing their corporate image? BTW, don’t try the BIG LIE technique here, e.g. that Amazon and the Internet are the same thing. The internet is an entity way bigger than Amazon, nor is it owned by them. And everyone here knows that. Don’t sign Amazon’s rip-off petition.

  • Elwood

    I will sign the petition first chance I get.

    Screw the state of CA and their “need” of revenue.

    The CA leg. and Jerry Brown are all a bunch of whores.

  • John W

    The tax already exists. It’s a tax on the buyer, not the seller. The issue is whether we can/should require Amazon, OverStock etc. to charge the tax to the buyers and pass it on to the taxing authority, as stores and California-based online retailers are required to do. Of course, it’s probably not necessary, since we can count on the honest California taxpayers to self-report their online purchases and pay the required tax. Ha, ha, ha.

  • Val Morehouse

    John W. is correct. Sales tax on sales in CA does exist. Amazon has huge sales in CA. We all know that. In fact in many cities and towns’ CA voters recently upped their own sales tax to fund government services because they “get” the connection between taxes and services. Amazon has not been paying their fair share, but acting like a giant vacuum cleaner sucking up CA $$$ wthout returning sales tax to CA for the common good. We are all in this together and need to contribute. As a practical matter, businesses are set up to collect the tax, not individuals. And many out of state businesses with websites do collect tax for CA. Perhaps you are not aware of that? And Elwood, do go sign the petition since you do believe so strongly in it. I object to Amazon’s misrepresentation of paying a its fair share as “Taxing the Internet.” That is a fraud against CA voters. If Amazon’s interests were confident that their position is really defensible, it would not be trying to put one over on the voters.

  • Elwood

    @ Val

    Since you’re so fond of taxes, perhaps you would like to pay some of mine. I’m tired of paying through the nose for very little benefit. Government is the most inefficient provider of services.

    Are you a Walmart employee, or perhaps a consultant for them?

  • Val Morehouse

    Nope. Nor am I a government employee. I’m not particularly fond of taxes either; but I do understand the direct relationship between taxes and keeping the garbage out of the streets, the kids in school, firemen and police on the job, the roads in repair, etc. etc. When I say the common good, that’s what I mean.

  • rosa

    You go, Val! Amazon’s legal counsel has always opposed having to pay sales tax in states where it doesn’t have “nexus”–a physical presence (like a warehouse)–on the grounds that it would be unconstitutional and places an insupportable burden on the company because of the complexity of sales tax laws, which vary from state to state.

    But he does seem to support having the federal government pass a law that will make it possible for states to enforce sales tax collection on businesses with no nexus in particular states:

    http://www.reuters.com/article/2011/07/30/us-usa-tax-online-idUSTRE76T0CO20110730

  • Elwood

    “keeping the garbage out of the streets, the kids in school, firemen and police on the job, the roads in repair”

    All commendable objectives to be sure.

    But government needs to learn to live within its means instead of always looking for new ways to squeeze the taxpayer. It never occurs to them to cut spending, but they’re always looking for more “revenue” Read: higher taxes.

  • John W

    Whenever I hear people say they already “pay through the nose” or, in the parlance of the Tea Party, “Taxed Enough Already,” but “keep government hands off my Medicare,” I can’t help but wonder about how much they actually pay compared to other people. That’s not a dig at Elwood. I’m sure he ponies up plenty to support my profligate liberal Utopia. But I hear people call radio talk shows and yell about how they pay 50% combined federal and state tax (income tax — not including payroll and other taxes). Nobody ever challenges them on that. I ask myself how they manage to do that with a top federal rate of 35% that doesn’t kick in until $379k and state top rate of 9.3% that doesn’t kick in for married folk until $94k (10.3% for those subject to the “millionaire tax”) after deductions for 401k, mortgage, state & local taxes, exemptions etc. Or people who moan about parcel taxes when they are long-term homeowners paying next to nothing in regular property taxes — not helping to pay for schools and other local services now or ever before when their own kids were in school. Or Tea Party jerk Congressman Joe Walsh who went bankrupt, defaulted on his house and didn’t pay child support and probably pays no income taxes and now preaches obnoxiously to Obama about fiscal responsibility. I can remember paying a 49% marginal rate at about $50k under Reagan before his tax cuts went into effect. Not saying that rate was a good thing, but people don’t seem to realize that, in the case of federal taxes, we’ve never been lower in our lifetimes. That said, here in California, we are at the high end in just about every tax category (high end for some and low end for others but average overall for property taxes) and really don’t have much to show for it.

  • Elwood

    “That said, here in California, we are at the high end in just about every tax category (high end for some and low end for others but average overall for property taxes) and really don’t have much to show for it.”

    Ain’t that the bitter truth! And the state is broke and crying for more money. Pathetic!

    My marginal income tax rate, state and federal combined is about 30% which seems plenty damned high enough to me. Especially considering that half the people in this country pay no income tax whatsoever. I have difficulty seeing the equity in that.

    Of course, I’m rich. The definition of rich being anyone who has a job or a source of income other than a government check.

  • John W

    Congratulations, Elwood. You are paying a higher federal marginal rate than hedge fund and private equity managers.

  • Elwood

    As you well know, John W, your post simply reflects the difference between rates on earned income and capital gains.

    I would imagine that you favor increasing the tax rate on capital gains rather than cutting the rate on earned income.

  • John W

    Elwood,

    Not talking about the long-term capital gains income they generate from investing and risking their own money. I’m talking about the share(generally 20%) of profits they are paid for investing other people’s money — activity that earns the typical hedge/PE manager tens or even hundreds of millions per year. They call it “carried interest.” But they get the 15% capital gains treatment, same as when investing their own capital. Nobody even pretends there’s a reason for it. A CEO I once worked for who now has a Private Equity firm has been on CNBC numerous times saying there’s no good reason for it. When the salesperson for the local GM dealer sells cars, his share of the profit he generates for that dealer is called “commissions,” and he pays ordinary income tax rates.

    Yes, I would raise the capital gains rate back to the 20% under Clinton. Would cut the corporate income tax rate in half but charge ordinary income rates on dividend income. I’d also either go back to the income tax rates under Clinton (phased in) for everybody (not just those over $250k) or eliminate deductions and exemptions and reduce the current rates by about 10% — more after we’ve paid down some debt.

  • Elwood

    “there’s no good reason for it”

    There are a lot of things in the tax code to which that statement can apply.

    The earned income tax credit for instance

  • John W

    That’s true Elwood, but the “carried interest” treatment doesn’t have even the pretense of a purpose and is a pure giveaway to some very, very wealthy people, paid for by the rest of us, directly or indirectly. I’m not a big fan of the EITC (a concept championed by Milton Friedman under the name of “negative income tax”), but at least it has a public purpose. Even the breaks for oil, corporate jets and ethanol have a stated purpose, however misguided.

  • Elwood

    @ #19

    The public purpose being the transfer of wealth from one class to another?

    Karl Marx and Saul Alinsky must really dig EITC.

  • Truthclubber

    @ 14 (aka Hellwoody) –

    Dude! Only a 30% marginal combined tax rate?

    That’s sooooo pathetic — I pay (and clearly make in order to pay) waaaaaay more than that!

    Looks like someone (like YOU!) needs to get a better paying job than the janitorial graveyard shift at the local Denny’s to supplement their meager (and Socialistic) Social Security checks…

  • Elwood

    @ toothsucker

    True to form.

    A liar and a sphincter.

  • Truthclubber

    @ Hellwoody –

    Like we’re all supposed to believe that you are a registered Dimmecrat?

    How stoopid do you think we all are? Oh, that’s right — you DON’T think.

    My bad.

  • Elwood

    @ toothsucker

    1. troll

    One who posts a deliberately provocative message to a newsgroup or message board with the intention of causing maximum disruption and argument

    See also: liar, sphincter

    http://www.urbandictionary.com/define.php?term=troll

  • RR, senile columnist

    Truthie : you are ridiculous

  • Truthclubber

    @ 25 — And you’re senile (my your own admission) — so who are YOU to talk?

    And you think that somehow Hellwoody’s claim that he is a registered Dimmecrat is NOT ridiculous?

    Up your dosage, dude — your current meds level is NOT working for you.

  • Elwood

    Liar, sphincter, etc.

    How about some more insane rants about Ellen Tauscher’s health and your vastly superior lifestyle?

    And did I mention egomaniac?

  • Truthclubber

    @27 — “Hellwoody the imbecile” (I’m using words he won’t have the IQ to understand so as to slide a fast one past nim…)

    1) Ellen Tauscher has lost a ton of weight (by virtue of her before and after pictures) since she was diagosed with cancer, and has clearly taken on the “Bill Clinton diet” (of no animal protein whatsoever) to make sure her post-cancer survival chances are increased — so STFU on that point.

    2) My own “vastly superior lifestyle” compared to your meager income is now noted in public — since you stated your pathetic marginal income rate and I stated how “vastly superior” my marginal income tax rate (as well as the income I would need) was — so STFU on that point.

    As for your last point, did you mention you were an egomaniac? You just did.

    You still haven’t dared to confront the BS statement you made about being a registered Dimmecrat — so refute THAT or STFU and go troll somewhere else.

  • Elwood

    @ toothsucker

    See #11 in the thread “Dissecting the debt-ceiling/deficit deal”

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