Santa Cruz merchants applaud proposal for online sales tax

SANTA CRUZ -- Local business owners welcome legislation to forceInternet retailers, including Amazon.com, to collect sales tax fromCalifornians shopping online.

Assemblywoman Nancy Skinner, D-Berkeley, announced AB 153Wednesday, saying the bill could generate between $250 million and$500 million for the state.

She rounded up support from representatives of the CaliforniaRetailers Association, California Federation of Teachers, theCalifornia Business Properties Association, and Northern CaliforniaIndependent Booksellers Association.

Former Republican Gov. Arnold Schwarzenegger vetoed previouslegislation and blocked online tax proposals during budget talks,saying it would cost jobs. Gov. Jerry Brown, a Democrat, has nottaken a position on the bill but it is not part of his plan to closea $25.4 billion deficit.

Leaders of Think Local First Santa Cruz County support the bill.

"Why should an out-of-state or online business not have tocollect sales tax when the business transaction happens inCalifornia?" asked member Karl Heiman, who owns Caffe Pergolesi inSanta Cruz. "The extra tax revenue will help California's currentfinancial crisis."

Eric Gil, owner of Sockshop & Shoe Co. in Santa Cruz, pointed outthat an out-of-state company selling online not only avoids payingsales tax but "pounds our infrastucture with FedEx and UPS trucksand employs no one in the state."

Bookshop Santa Cruz owner Casey Coonerty Protti added, "Out-of-state corporations like Amazon don't need special favors."

Americans for Tax Reform, a Washington, D.C.-based group, calledthe proposal "a guaranteed job-killer."

However, browsers at Bookshop Santa Cruz Wednesday had fewobjections to taxing online sales. Lindsay Dye, 53, shopping withher son, said she had paid sales tax for online purchases.

"I don't see why books should be different," she said.

"Taxes should be raised to meet the needs we have," said NatalieSharp, 20, of Santa Cruz.

"I wouldn't like it but I could live with it," said JackFerguson, 77, a Santa Cruz retiree who has purchased music and shoesonline. "It should be an equal playing field."