christian news: California to require use tax from out-of-state sellers

Friday, August 31, 2012

California to require use tax from out-of-state sellers

Photo: Board of Equalization

Betty Yee represents the Bay Area on the Board of Equalization.

California will require out-of-state retailers to register with its Board of Equalization and collect "use tax" on stuff they sell to customers in the Golden State.

The new law kicks in Sept. 15, and the BOE is sending letters to 200 sellers not based in California to notify them of the change.

Though use tax has been much in the news as the state has wrestled with online giant Amazon.com Inc. (NASDAQ: AMZN), it's been on the books since 1935, when the out-of-state boogeyman was the Sears mail-order catalog.

Under the new law, AB 155, any retailer that has sold more than $1 million in merchandise to California consumers and has had more than $10,000 in sales referred by an affiliate in the state, must collect use tax (it's the same rate as local sales tax) and pay it to the government.

California online shoppers will start seeing the tax on their bills Sept. 15, the BOE said. But the onus is still on consumers to pay use tax if the retailer fails to charge them for it.

Rather than heckling millions of individual consumers to keep track of or guess at their use tax, California will now be able to focus its enforcement efforts on a smaller group of businesses.

Betty Yee represents the Bay Area on the Board of Equalization.