1

What they’re saying about the ‘Amazon tax’ delay

Gov. Jerry Brown has just signed a compromise that puts off making online retailers like Amazon.com collect sales taxes in California for one year, giving the industry time to lobby Congress for protection.

My colleague Steve Harmon was at the signing event in San Francisco and will be filing a full report shortly, but meanwhile, we’ve got stakeholders comments pouring in.

Assemblywoman Nancy Skinner, D-Berkeley, was among architects both of the “Amazon tax” bill passed in June and of this compromise delay, which convinced Amazon to drop its plans to spend millions on a repeal ballot initiative next year.

“The issue of eFairness is all about protecting jobs and businesses in California,” Skinner said in a news release. “AB 155 ensures a level playing field for California stores so they can keep their employees and support our communities, and it means new revenue that can be used for our schools, seniors and safety.”

“AB 155 is an historic compromise that sees online companies and brick-and-mortar retailers coming together. Businesses already face a lot of troubling uncertainties these days. AB 155 and Amazon dropping its challenge to eFairness in California takes some of that uncertainty away.”

State Sen. Loni Hancock, D-Berkeley, also pushed hard for the tax.

“This is a classic compromise that will greatly benefit the state,” Hancock said in her news release. “For the first time, Amazon acknowledges that it is obligated to collect and remit California sales tax and that it will begin doing so, without further challenge, in September 2012. Amazon has also agreed to forgo any further attempt at a referendum and will not pursue court challenges. We now have a clear path to creating a level playing field where the state’s brick-and-mortar businesses will not be at an unfair disadvantage.”

Assembly Speaker John Perez, D-Los Angeles, said California today “has moved forward towards achieving fairness. AB 155 closes a loophole that gives out-of-state online retailers an unfair advantage over stores in California, giving retailers time to achieve a federal solution. Overall, more jobs will ultimately be protected and created within the state.”

Paul Misener, Amazon’s vice president of global public policy, issued a statement saying the company is grateful to Brown and the Legislature’s bipartisan leadership “for this win-win law.

“We’re excited that we now can create 10,000 jobs and cause $500 million in investment in California in addition to reinstating our California-based affiliates,” he said. “We’re committed to working with Congress, retailers and the states to pass federal legislation as soon as possible and as analysts have noted, we’ll continue to offer customers the best prices, regardless of whether sales tax is charged.”

40

Lawmakers: Cancel your Amazon.com account

A pair of East Bay lawmakers will join with a group of nonprofits and concerned citizens Monday to launch a campaign urging Californians to cancel their Amazon.com accounts until the retail giant backs off its ballot-measure effort to repeal an online sales tax.

State Sen. Loni Hancock, D-Berkeley, and Assemblywoman Nancy Skinner, D-Berkeley, who were instrumental in the tax legislation’s passage, will hold a news conference on the State Capitol’s north steps Monday morning with Nan Brasmer, president of the California Alliance for Retired Americans; Jessica Lehman, lead organizer with Community Resources for Independent Living; and a few dozen California seniors, families, people with disabilities and health and human services advocates.

They’ll be making a case that making Amazon collect sales tax from Californians’ online purchases would level the playing field between online and brick-and-mortar businesses, bringing the state $200 million per year in revenue that’s desperately needed to maintain vital public services.

After the news conference, participants will testify to the state Senate Appropriations Committee in support of additional measures needed to raise revenues.

Monday’s event, one of several planned statewide, is sponsored by the Health and Human Services Network of California, California Partnership, Health Access, California Immigrant Policy Center, Western Center on Law and Poverty, Parent Voices, California Alliance for Retired Americans, Community Resources for Independent Living and other groups.

31

Amazon, other tax foes launch new committee

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.

3

Amazon seeks ballot measure to repeal sales tax

A lobbyist for online retail giant Amazon.com submitted to the Attorney General’s office Friday a draft of a proposed ballot measure that would roll back the online sales tax just passed by the Legislature and signed into law by Gov. Jerry Brown.

Amazon’s “California Jobs Referendum” will be reviewed and given a title and summary by the AG’s office before it’s cleared to start gathering petition signatures to be placed on the ballot.

Amazon Vice President of Public Policy Paul Misener issued this statement today:

“This is a referendum on jobs and investment in California. We support this referendum against the recent sales tax legislation because, with unemployment at well over 11 percent, Californians deserve a voice and a choice about jobs, investment and the state’s economic future. At a time when businesses are leaving California, it is important to enact policies that attract and encourage business, not drive it away. Amazon looks forward to working again with tens of thousands of small business affiliates in California that were harmed by the new law’s effect on hundreds of out-of-state retailers. As Governor Brown has made clear, it is important to directly involve the citizens of California in key issues and we believe that Californians will want to vote to protect small business and keep jobs in the state.”

As my Mercury News colleague Patrick May explained last month, 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 more fair, forcing Internet retailers to collect taxes just as brick-and-mortar stores already do. Several other states have enacted similar statutes.

UPDATE @ 4:30 P.M.: Board of Equalization member George Runner says “I told you so:”

“As I warned, Californians are losing jobs and income as a result of the so-called ‘Amazon Tax.’ It should come as no surprise that impacted California business owners would seek its repeal.

“Clearly, the ‘Amazon Tax’ is not working. After having terminated their relationships with thousands of California-based affiliate businesses, leading out-of-state online sellers continue to sell into California without collecting the sales tax.

“My staff has identified more than three dozen online sellers that have terminated their affiliate programs. Each termination represents lost jobs and lost income for California—losses that could have been easily avoided had the Governor and Legislature exercised a little common sense.

“Proponents of the ‘Amazon Tax’ claimed it would ‘create fairness’ by ‘leveling the playing field’ between California’s brick and mortar retailers and out-of-state online sellers. They claimed it would generate $200 million in new revenues for the state this year. But they were wrong.”

UPDATE @ 4:54 P.M.: State Sen. Loni Hancock, D-Berkeley, who sponsored some one of the bills that led to the online sales tax, says, “It is unfortunate that Amazon – a multi-billion dollar corporation – continues to argue for a tax loophole that gave them a unfair advantage against California’s small business owners. All we are asking is that they collect and remit their fair share of taxes, like everyone else.”

UPDATE @ 5:24 P.M.: Board of Equalization member Betty Yee doesn’t see eye-to-eye with her colleague George Runner. “It is in every Californian’s interest for online and store front businesses to play by the same rules,” Yee said in a news release. “I strongly doubt Californians will support a loophole promoting out-of-state jobs, when holding Amazon.com accountable to the same rules as everyone else protects California’s economy.”

1

Ellsberg, filmmakers rally to Wikileaks’ defense

The hullabaloo over Wikileaks’ release of a slew of U.S. diplomatic communications, and the subsequent hounding and arrest of Wikileaks founder Julian Assange, has brought the spotlight back to one of the nation’s most well-known whistleblowers: Daniel Ellsberg, who in 1971 released the “Pentagon Papers,” a secret and damning study of American decision-making in the Vietnam War.

Now 79 and living in Kensington (the small unincorporated community just north of Berkeley), Ellsberg already was the subject of a new documentary this year, “The Most Dangerous Man in America.” But since the Wikileaks story broke, he’s been making the media rounds – including NBC Nightly News, BBC, ABC’s Nightline and many more – in Assange’s defense.

On Dec. 3, he posted to his blog an open letter to Amazon.com founder and CEO Jeff Bezos calling for a boycott of the company because he’s “disgusted by Amazon’s cowardice and servility in abruptly terminating its hosting of the Wikileaks website, in the face of threats from Senator Joe Lieberman and other Congressional right-wingers. I want no further association with any company that encourages legislative and executive officials to aspire to China’s control of information and deterrence of whistle-blowing.”

But apparently he’s got a kind of an association with the company whether he likes it or not. Berkeley-based documentary filmmaker Rick Goldsmith, who co-produced and co-directed “The Most Dangerous Man in America,” noted in an e-mail today that the DVD of the film is being sold on Amazon.

“Contractually, we cannot change that arrangement,” Goldsmith wrote. “However, we are encouraging everyone who wants to buy our dvd (a great holiday gift for young and old alike!) to AVOID AMAZON and instead go to our website, www.mostdagerousman.org. Under ‘Buy the DVD’ click on the appropriate button. You can buy it for the same low price as you would on Amazon, and strike a blow against political opportunism in the process.”

Goldsmith’s e-mail also directed readers to a support network for U.S. Army Private First Class Bradley Manning, reportedly the source of the Wikileaks leaks, now being held in a Marine Corps brig in Virginia and likely to face a court-martial.

UPDATE @ 4:02 P.M. WEDNESDAY: Goldsmith just e-mailed out an addendum disclosing that his partner on the Ellsberg film, Judith Ehrlich, has begun production on a film about Wikileaks, and it was her idea that they take part in the Amazon.com boycott.

12

Skinner: Tax online retailers with Calif. networks

Assemblywoman Nancy Skinner, D–Berkeley, today introduced a bill to levy sales taxes on certain out-of-state Internet businesses making sales in California.

Assembly Bill 178, she said, is a stab at “leveling the playing field for California’s brick and mortar businesses” by requiring that out-of-state companies “which maintain a network in California and thus have a presence in the state” would have to collect sales taxes on orders received within the state.

Although her office couldn’t provide a copy of the bill Monday, she said it’s modeled closely on a similar law enacted in New York; that law says an internet retailer’s affiliates based within the state qualify as a “physical presence” or “nexus” — the U.S. Supreme Court’s standard on whether online retailers are subject to sales taxes in a given state.

“This legislation will close the current loophole in California tax law which has allowed out-of-state companies to avoid collecting California sales and use tax,” Skinner said in her news release. “During this unprecedented fiscal crisis we cannot afford to lose sales tax revenue from out-of-state companies when our own local businesses are struggling to keep their doors open.”

Skinner’s bill – co-authored by Assembly Revenue and Taxation Committee chairman Charles Calderon, D-Montebello – would exempt businesses doing less than $10,000 worth of business per year in California; she estimates the bill would raise about $55 million in revenue per year.

Amazon.com had helped lead a court battle challenging New York’s law, but a judge dismissed its lawsuit last month. An e-mail seeking comment from the Seattle-based online retail giant wasn’t immediately answered today, but there’s no question that Skinner’s bill targets this company just as New York’s seemed to do.

“This bill helps preserve businesses and jobs in our communities,” Hut Landon of the Northern California Independent Booksellers Association said in Skinner’s news release. “Independent booksellers have been hammered by unfair tax competition from Amazon for over a decade. And as Amazon has expanded its retail reach, more and more locally-owned businesses are faced with unfair competition. We welcome this effort to level the playing field for all retailers.”

UPDATE @ 9:55 A.M. TUESDAY 2/3: Click here for a copy of the bill. And although Amazon.com declined to comment, the Council on State Taxation sent me a note tearing the idea apart. Read COST’s stance, verbatim, after the jump… Continue Reading