Amazon purchases will cost more for CA residents in the coming year

Braulio Campos

Shopping on Amazon could get more expensive for California residents in September 2012 if a new bill passes the state legislators.

The online retailer had been exempt from paying state taxes until part of Gov. Jerry Brown’s budget required out-of-state online retailers collect the tax if they had business ties to the state.

After a failed attempt at repealing the law, Amazon offered to hire 7,000 people in California and drop its effort to reverse the act if the state pushed off enforcing the taxes for one year, Forbes reported.

Gov. Brown has until Oct. 9 to sign or veto the revised version of the bill.

Online tax would let California collect almost $200 million in tax revenue, thus forcing online companies to collect it from customers.

Online tax is equal to the state tax, which is 7.75 percent in California.

Use tax, taxes levied on in-state business, must be paid by a company or voluntarily paid by its customers, according to the State Board of Equalization, which collects the taxes.

Other online retailers are currently collecting taxes and are not exempt under this deal.

Buying something from a Californian on ebay will add sales tax to a purchase, and Newegg, based in Whittier, also applies sales tax.

Students like Henry Jauregui, 28, use Amazon to find cheaper books, and the sociology major said he avoids sales tax by purchasing from out-of-state vendors.

“The state should come first, but as a consumer this is good news,” Juaregui said.  “Plus, if you think about, 7,000 more workers means more people paying taxes.”

Others think online retailers should be completely exempt from taxes because all products do not come from Amazon warehouses, private citizens post goods on the site.

“More jobs are involved,” said Alain Babaian, urban studies major. “It’s not just Amazon who sells on Amazon.”