Monday, July 11, 2011

Will there be a Tax Referendum in California? Amazon latest today, backed a referendum call for California voters to remove the tax legislation from the books over the next year.
It was widely reported from Sacremento today that California legislators may face their recent online tax legislation being disapproved in a popular referendum. Amazon at the end of last week filed a paper proposing removal of the law by popular ballot sometime next year.

The proposal was accepted by the State government last week and now faces a preliminary vote where nearly 450,000 Californians need to support the proposal or proposition. If this number of supporters is raised the proposal will or should be written up for application on the November 2012 ballot.

Given the current situation, this proposal will, even if it passes, mean many California affilliates will have been without Amazon for over one year, there is little possibility of a stay of execution in anticipation of the proposal succeeding. With over a year of lost business many California affilliates will possibly not survive.

This is a good step for to have taken. I will look forward to supporting the proposal during the next few months.

Given that many Californians already feel they are oppressed I think the proposal could succede. Though many proposals for extended sales tax finance proposals are also on the books for re proposition. In my own county, Fresno, we have a Measure B proposal which supports the public library system up for a continuation proposal. Even though the Public Library system is a popular system to support, continued support of Measure B is unlikely. This will turn a very small percentage of sales tax back to county coffers for other items.

The proposal could face one problem.

In its original tax legislation, sales tax in California was to be reduced by 1% with the decrease being filled with the online taxes.
State legislators could demand an increase in overall sales tax to levels above  the June 2010 level in part to compensate the state for lost revenue and in part to punish or disuade the voters from accepting the abolision proposition.

Financial Times Report

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