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Web Retailers Beware: California Wants Your Taxes

Updated on September 1, 2012

California is strapped for cash in a serious way, much like the USA. Both are deep in the RED. However, California intends to go after the many web retailers online who have never or failed to collect state sales taxes for items bought on websites. Most of the targeted will be smaller businesses that also have a brick and mortar business in the state, the big national chains have already been paying state sales taxes, which averages 7-8%. Many websites have real business stores, yet, when a purchase is made online at their website, the customer is not charged sales tax. California intends to change it and expects to recover over $300 million the first year. The state is also hiring 100 state auditors to track down the renegade Internet merchants. So far, 200 businesses in the state have been put on notice.

It is unclear if the small mom+pop website will also be targeted, which would mean, just about everyone with a site up and selling something. Does one's home count as a real "brick and mortar" business where the public can enter and buy? It doesn't seem so, but who knows?


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