California "Amazon Sales Tax" Veto Referendum (2012)

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A California "Amazon Sales Tax" Veto Referendum (11-0019) will not go on the state's 2012 ballot.[1],[2]

11-0019 was an attempt to use California's veto referendum process to nullify a legislative bill approved by the California State Legislature and signed by Gov. Jerry Brown. Specifically, the proposed referendum sought to overturn Section 1 of ABx1 28 (Stats. 2011 First Ex. Sess., Ch. 7 § 1).

Signature-collection efforts on 11-0019 came to a halt in early September 2011 when California legislators and Amazon reached an agreement under which:

  • The State of California will delay collecting sales tax from online retailers until September 2012.
  • Amazon will drop its effort to qualify #11-0019 for the ballot, and will instead devote its efforts to lobbying the U.S. Congress to develop a national policy on sales taxes for online retailers.[3][4]

Amazon spent over $5 million on signature collection before the petition drive was halted.[5]

ABx1 28

ABx1 #28, the bill that sparked Amazon's interest in a veto referendum, requires Internet retailers to pay sales tax if they have affiliates or subsidiaries in California.

Under the new law, California tax experts say that online retail giant Amazon will owe approximately $83 million in additional taxes each year.[1]

Text of measure

See also: Ballot titles, summaries and fiscal statements for California's 2012 ballot propositions

Ballot title:

Referendum to Overturn Law Requiring Internet Retailers to Collect Same Sales or Use Taxes as Other Retailers.

Official summary:

"If signed by the required number of registered voters and filed with the Secretary of State, this petition will place on the statewide ballot a challenge to an existing state law. The law must be approved by voters at the next statewide election to remain in effect. The law expands the definition of retailers considered "engaged in business" in California to include certain Internet retailers selling to California consumers, so that out-of-state Internet retailers also collect existing sales or use taxes."

Support

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Internet retailing giant Amazon.com has made it clear that they plan to directly lead the fight to overturn ABx1 28.[6]

Paul Misener, an Amazon vice-president, says, "This is a referendum on jobs and investment in California. As Governor Brown has made clear, it is important to directly involve the citizens of California in key issues and we believe that Californians will want to vote to protect small business and keep jobs in the state."[7]

Donors

As of late August 2011 Amazon has spent a total of $5.25 million in support of the proposed referendum.[8]

Opposition

ABx1 #28, the law that might be overturned by 11-0019, was sponsored by Bob Blumenfield and was signed by Jerry Brown on June 28, 2011.[9]

Commercial interests with physical locations in California already pay sales tax. These include giant retailers such as Wal-Mart and Target. Spokesmen for those organizations say they will fight Amazon's effort to overturn ABx1 #28 because in their view, the fact that Amazon doesn't have to charge sales tax on the products it sells online, while they do have to charge sales tax to customers when they sell the same item, gives Amazon (and other online retailers) an unfair advantage.[1]

John Burton, the chairman of the California Democratic Party, said, "Why the **** should Amazon skate when we have a state where we are shutting down schools, shutting down hospitals, firing teachers, firing cops, firing firemen, screwing mental health people — because they don't want to have a god damned sales tax like everybody else...My daughter gave me a Kindle for my birthday present, and I will not use it because of these god damned people at Amazon. I go to my bookstore, buy a god damned book, and sit and read it. It is that simple. I can read it taking a crap, as opposed to looking at a Kindle or a computer taking a crap."[10]

Path to the ballot

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See also: California signature requirements

Sponsors of 11-0019 must collect 504,760 signatures by September 27, 2011, which is 90 days after they received an official ballot title from the Attorney General of California.[6]

The letter requesting a title and summary for the proposed referendum was signed by Charles T. Halnan , and was received by the Attorney General of California's office on July 8, 2011.

See also: California ballot initiative petition signature costs

See also

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