Forty-eight hours after Gov. Jerry Brown signed California’s sales tax fairness provision, which requires out-of-state retailers to collect taxes on sales made to California customers, Barnes & Noble has issued a statement.
“We thank Governor Jerry Brown for demonstrating his commitment to California businesses by signing e-fairness into law. This legislation will directly benefit California businesses by creating a fair marketplace,” said William Lynch, Chief Executive Officer, Barnes & Noble. “We believe that e-fairness will improve the economy, add jobs, and help struggling businesses everywhere in California. By signing this law, the Governor has made clear that his priorities are to help bolster economic recovery. This is a huge win for business in the state of California.”
It’s not hard to sense the glee in B&N’s statement as they watch their biggest competitor take a tumble in another state and cut ties with more affiliates. But it’s also hard not to see a measure of hypocrisy in Barnes & Noble championing a level playing field, when in the not-so-distant past B&N was running independent bookstores to the ground with their discounts.
It’s understandable for people out there to relish the sight of Amazon, in the big faceless corporate sense, squirm around as fairness prevails (and, no matter which way you cut it, the e-fairness legislation is nothing if not fair). But don’t forget all the affiliates that got dumped in the process–they’re the ones who are really losing here, not big, bad Amazon. Hopefully it won’t take another 12 years of legal battling to make things fair for them, too.
I agree with a previous poster. This law will let politicians posture, but it’s not likely to pass muster in court. If the IRS doesn’t regard Amazon’s affiliates as employees, then it difficult to see how California can claim Amazon has a business presence in the state.
Of course, I also believe that, when Amazon does have a presence in the state, including a shipping center, they should be paying taxes just like mom-and-pop bookstores. The tax money for schools for Amazon’s employees and police to keep that warehouse from being robbed has to come from somewhere.
I also get rather ticked off when I see states (“Yes, that’s you Texas.”) letting Amazon, simply because it is huge, avoid sales taxes that a little bookstore, perhaps just blocks away, has to pay. That’s as foul as anything California is doing.
Amazon and B&N are slugging it out in a battle for EBook supremacy. Also to demonstrate whether big box brick and mortar bookstores are still needed in this electronic age – they are not.
I’m glad B&N is happy, but they’d best enjoy while they can. CA’s “e-fairness” tax won’t hold-up against the inevitable constitutional challenge. Per the U.S. Supreme Court’s longstanding interpretation of the Commerce Clause of the U.S. Constitution, individual states possess absolutely no power to tax or otherwise regulate interstate commerce. In the absence of an Amazon brick & mortar presence in California, the state has no authority whatsoever to levy its “e-fairness” tax.
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So hyprocritical. Thinking about brousing at B&N for books to purchase on Amazon.
B&N tried to open a huge bookstore in Austin across from a wonderful independent bookstore called Book People. Thank God they weren’t successful….. I quit going to a B&N altogether when they did that.
The note I received from Amazon, in cutting me off from the program, states that “We deeply regret that we must take this action.” I was deeply moved.
My working life was spent in brick and mortar retail. I always felt that it was unfair to order online and not pay taxes. No I did not own the business I was just an employee who wanted the business to succeed. Today I used Amazon as a research tool to find what I wanted and went direct to the vendor and paid the taxes. I am second generation Californian and I support this.