Amazon Tax Would Slam eBay, Too

June 23, 2011 - By admin

John Seiler:

Our Katy Grimes first wrote a story, two days ago, about how the tax-ravenous Legislature’s attempt to tax Amazon, a company based in Washington state, also would slam eBay, which is located right here in San Jose. The Sacramento Bee caught up with her today, reporting:

California lawmakers thought they were targeting Amazon.com, the out-of-state giant, when they voted last week to force Internet retailers to collect sales tax.

It turns out eBay Inc., California’s own golden child of e-commerce, isn’t so thrilled about it, either.

The San Jose online auction company says the legislation would hurt its business model, which relies on thousands of entrepreneurs who sell goods on its site.

The intent may have been to go after Amazon, but “we’re literally caught in the crossfire,” said David London, senior director for state government relations at eBay.

Another question is what to do with foreign sales. Over the past decade, I’ve bought several items from Europe from Amazon and eBay, all of them low-priced books or music, maybe one a year. I’m currently bidding on some cassette tapes from Ireland. The price if I “win,” in U.S. dollars, is about $6.78. The shipping is about another $10. Not much in either case.

I’m buying from a private seller through eBay’s auction system. Should the Irish seller, from what I can tell a small Mom and Pop outfit, be forced to collect California sales tax from me on the purchase price, which would be about 60 cents, and remit it to the Board of Equalization? Should eBay be forced to figure this out?

What benefit does the small Irish company get from paying 60 cents to the state of California? Do they get to use our crumbling freeways or our sub-par schools? How about the lavish pension system for government workers? Nope. They get nothing because they live 5,000 miles from here.

This example demonstrates the absurdity of the situation. But our leaders in the Legislature don’t understand business, especially not small business. Both Assembly Speaker John Perez and Senate President Pro Tem Darrell Steinberg are government union hacks. They only look to see how to grab private-sector wealth, not how to foster its creation.

Let’s hope Gov. Jerry Brown, who fostered small-business creation as Oakland’s mayor, has more sense and vetoes the Amazon-eBay tax.

June 23, 2011

 

 

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Comments(1)
  1. Keep da Peace says:

    This is one area I heartily agree with the writer. One only has to see that this is a discincentive for on-line retailers to not do business in California or to create “special” pricing for goods and services. There is not enough money that the state will actually be able to realize from these sales unless they strongarm the big sites. Hopefully, this piece of junk legislation won’t pass. If it does, I hope Amazon dors what they did in other cases and just thumb their nose at CA.

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Joseph Perkins
Joseph Perkins, now assistant editor of the Orange County Register Opinion Pages, started his career as an editorial writer for the Wall Street Journal. After serving on the White House Staff of former Vice President Dan Quayle he wrote for the San Diego Union-Tribune where he authored a nationally-syndicated column. Before writing for CalWatchdog.com, Mr. Perkins was also Business Editor for San Diego Magazine.
Chris Reed
Chris Reed is a regular contributor to Cal Watchdog. Reed is an editorial writer for U-T San Diego. Before joining the U-T in July 2005, he was the opinion-page columns editor and wrote the featured weekly Unspin column for The Orange County Register. Reed was on the national board of the Association of Opinion Page Editors from 2003-2005. From 2000 to 2005, Reed made more than 100 appearances as a featured news analyst on Los Angeles-area National Public Radio affiliate KPCC-FM. From 1990 to 1998, Reed was an editor, metro columnist and film critic at the Inland Valley Daily Bulletin in Ontario. Reed has a political science degree from the University of Hawaii (Hilo campus), where he edited the student newspaper, the Vulcan News, his senior year. He is on Twitter: @chrisreed99.
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John Seiler
John Seiler has been writing about California for 25 years. That includes 22 years as an editorial writer for the Orange County Register and two years for CalWatchDog.com, where he is managing editor. He attended the University of Michigan and graduated from Hillsdale College. He was a Russian linguist in U.S. Army military intelligence from 1978 to 1982. He was an editor and writer for Phillips Publishing Company from 1983 to 1986. He has written for Policy Review, Chronicles, LewRockwell.com, Flash Report and numerous other publications. His email: writejohnseiler@gmail.com

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