California Shoppers Would Feel the Pinch of Proposed Internet Sales Tax

By Keith Esparros
|  Monday, May 6, 2013  |  Updated 9:06 PM PDT
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CA Shoppers Would Be Pinched By Internet Sales Tax

Evan Stulberger

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California consumers could see their online purchases get more expensive, if the House of Representatives joins the Senate in passing what’s known as the Marketplace Fairness Act.

That act would require consumers to pay sales tax on almost all of their online purchases. Right now, buyers only have to pay sales tax if their online retailer has a presence in California.

For instance, California consumers are already paying sales tax on anything bought from Amazon.com, which plans to have up to 10 facilities in the state over the next three years.

The bill would extend the sales tax collections to any online retailer with more than $1,000,000 in gross annual sales.

Supporters of the bill say it levels the playing field by removing a big advantage of online retailers, many of whom do not charge sales tax, making their products cheaper.

But opponents say it’s a huge tax increase, and could hurt the country’s still-recovering economy. Those against the bill also point out the difficulty in determining how much sales tax to charge, since it varies from community to community.

So, how much is this going to cost you? That depends on where you live.

Sales tax rates in Southern California generally run from about 7 percent to 10 percent, so the bill could add as much as $100 to a $1,000 purchase.

To determine what the sales tax is in your community, click here.

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