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March 17, 2008

itunes_store

Cali wants to tax the ‘tunes

Posted Mar. 17, ’08, 10:45 AM PT by Dan Pourhadi
Category | iTunes » iTunes Store

california5taxes.jpgA great man once said that nothing is certain but death and construction on the road you use to get to work causing an hour’s worth of traffic when you need to be to work in ten minutes otherwise you’re gonna get fired because you already pissed off the boss by ogling his daughter and doing a pretty bad impression of him as he walked into the room but your coworkers were too embarrassed to mention that he was standing right behind you so he saw everything and is now looking for any excuse to can my sorry ass.

Oh, and taxes. Death, that, and taxes.

California, facing an $8 billion deficit for spending way too much on the next Terminator sequel and all those crazy “come-to-Califownia” ads, is considering a new tax on iTunes purchases to pay for the Governator’s next chest-waxing. The Golden State currently only taxes “tangible” goods — those that can be “seen, weighed, measured, felt, or touched” — leaving digital purchases tax-free. From The Orange County Register:

Last month, Assemblyman Charles Calderon, D-Whittier, introduced Assembly Bill 1956, which would apply sales taxes to media downloads. That would take a 99 cent song and bump it to $1.07 or more.

New taxes require a 2/3rd vote of the Legislature, meaning some anti-tax Republicans would have to sign onto the proposal, but Calderon got creative. Instead of proposing a new tax, AB 1956 simply requires the Board of Equalization to amend the definition of “tangible personal property” to include “digital property.” That needs only a majority vote, meaning no Republicans necessary.

Clever bastard.

What say ye, Californians? Are you willing to pay those 8 cents extra…or is revolution in order?

[via MacDailyNews]


12 Comments

sono Author Profile Page said:

As an iTunes-buying Californian, I vote no.

Oh, wait, this up in the legislature, I don't get a vote.

Where did I put the number for my district rep...?

March 17, 2008 10:56 AM
CVBruce said:

Some companies have been doing this for some time now. ROXIO, for one, charges California state sales tax, when you purchase a product with electronic delivery.

I think that Apple does this too, but it's been so long that I'm not positive. For example if you go to the apple store, and purchase a "PRO" upgrade to Quicktime, if memory serves me correctly, the Apple store will charge sales tax even though the only thing you receive is a registration number via email.

March 17, 2008 11:15 AM
stephen said:

I live in Alabama and have been paying sales tax on all my iTunes downloads ever since I got an iPod. In the city of Birmingham our total sales tax rate is now 10%, which is what iTunes kindly collects from me. We even get taxed on the cost of shipping when we order physical goods online. I always just figured everyone had to pay sales tax for downloaded music - it would be interesting to learn which other states still allow digital deliveries to circumvent the sales tax...

March 17, 2008 11:24 AM
David Jones said:

Why should this come as a surprise to anyone? The ultra-leftist government of this state taxes just about everything you can imagine--sometimes more than once! The only Republican who wields any power is about as liberal as you can imagine a Republican ever being (I'm beginning to think Gray Davis was more conservative). This state government has broken under 20+ years of one-party rule (Pete Wilson doesn't count, either), which is but one reason why I am moving as soon as possible.

To Arnie and the rest of the libs in Sacramento: keep your mitts off my money. No more gas taxes. No more cash grabs by expanding sales tax to apply to online purchases and non-tangible items. The problem isn't that there isn't enough money--the problem is that the government doesn't spend right. Unfortunately, the same problem exists at so many levels of government, from the feds to the city of Los Angeles.

March 17, 2008 11:30 AM
CVBruce said:

stephen,

In California, the online service may or may not charge tax on shipping and handling. It's kind of a fuzzy area. Let me put it a different way. It isn't required to charge tax on shipping and handling, if my understanding is correct.

March 17, 2008 11:49 AM
GodOfBiscuits Author Profile Page said:

I say yes.

Face it: you're taxed on music if you buy the CD. The download is just a different delivery system for the same thing.

Not having to cut education budgets as much is just a "little" more important than an extra 8 or 9 cents per song.

March 17, 2008 12:23 PM
krye said:

That's BS. Nothing has crossed state lines but electrons. What are they going to tax next? Your email?

March 17, 2008 12:24 PM
nwmike said:

Pretty much if you pay sales tax in your state the company you buy from is required to collect sales tax from you. This in turn is turned over to the state. Our company just recently had to deal with the state of California on this.

" to pay for the Governator’s next chest-waxing." meh. Actually, it's more likely to be to pay for all the tax benefits non-tax payers are receiving.

March 17, 2008 12:31 PM
WRCz said:

Some time ago, one of those Cali commercials featured Ahnold telling us 'there ARE no rules in Kaleeforneeya!'

Hahahahahahahahahaha.

March 17, 2008 12:41 PM
Anonymous said:

California has a sales and "use" tax. If you buy something online and are not charged tax on it, you still owe the tax. That is , if they catch you. They do have a line on the income tax form just for declaring this tax. Seems I never have anything to declare. or do I? :)

March 17, 2008 1:04 PM
Jarro said:

They're just trying to copy Jersey again.

First they copy our state shape and try to reverse it.

Then they try and tax downloads.

Next, their governor will turn gay.

Come up with something original for once!!

March 17, 2008 3:21 PM
Dave-O said:

@stephen, how are the plans for the stadium with no team coming :) That cracks me up.

I'm no tax expert, but I'm not paying sales tax on iTunes downloads and I'm under the impression most states don't (the rules for sales tax on online purchases are complicated, something about whether the company operates in your state, there are 4 Apple Stores in MN, therefore we pay tax on the online Apple Store).

My position on the tax would be No (technically, I suppose my position is I'm glad I don't live in CA). I pretty much never approve of regressive taxes. The environmental argument is that the state should be promoting online downloads to save of the environmental cost of shipping CDs across the country.

March 17, 2008 4:58 PM

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