California Gov. Vetoes Budget, But Sales Tax Fairness Stays in Mix

On Thursday, California Gov. Jerry Brown vetoed a proposed budget that contained a sales tax fairness provision. Only a day earlier, the California legislature had approved the budget, which would have required out-of-state online retailers with nexus in the state to collect sales tax on sales made to California customers. However, the sales tax fairness campaign in the state is not over. In vetoing the budget, Gov. Brown did not single out the sales tax fairness provision as a contibuting factor.

“We are grateful to California legislators for standing up for in-state retailers,” said Oren Teicher, ABA CEO. “However, with the governor’s veto — which we do not believe hinged on sales tax equity — our campaign for sales tax fairness in California continues. Later this summer, together with NCIBA and SCIBA, we will be asking our bookstore members in California to call or e-mail their legislators and Gov. Brown in support of AB 28X, the sales tax fairness provision. We must work to ensure that sales tax fairness is preserved in the final budget.”

Sponsors of the sales tax fairness provision believe that AB 28X will bring in an estimated $200 million per year, MercuryNews.com reported. “We’re finally on the way to creating a level playing field for California companies,” said Sen. Loni Hancock (D-Berkeley), author of one of the three bills that were merged into the budget proposal, the article noted. “All in-state businesses already collect and remit taxes, so those that do not — like Amazon, Overstock, and others — have an unfair advantage,” she said.