2
0

Stop Selling to California


 invite response                
2019 Apr 4, 8:54am   1,255 views  15 comments

by MisdemeanorRebel   ➕follow (12)   💰tip   ignore  

Those of us who live in California are used to the state’s aggressive tax-collection policies. Despite record-setting budgets, the state never has enough revenue to fund all the programs it wants to create or expand so the tax authorities have to shake every last dime out of residents’ pockets. But now, thanks to confusion over how to collect online sales taxes, California’s tax-collection agency may be coming for you — even if you sell a few items from your kitchen table in Kansas.

The newly created California Department of Tax and Fee Administration (CDTFA) has been sending collection letters to small businesses that sell products via online retail platforms such as Fulfillment by Amazon. The agency claims that such third-party sellers owe eight years of back taxes because they are considered to have a physical presence in the Golden State. The agency threatens tens of thousands of dollars in fines and imprisonment of up to three years.

It’s a frightening proposition. As California Treasurer Fiona Ma noted in a recent letter to Gov. Gavin Newsom, she’s heard from a Washington state third-party seller who is “distraught and frightened” after receiving a letter from California telling her that she’s “facing tens of thousands of dollars in back taxes, penalties and interest” — something that “will force us out of business and into bankruptcy.” The seller has complied with California tax rules and signed up for a California business license, but now our state wants uncollected sales taxes going back eight years.

How can a Washington business potentially be forced into bankruptcy by Sacramento taxing authorities?

Well, the entire online tax-collection issue is complicated and unresolved. In 2018, the U.S. Supreme Court ruled in the South Dakota v. Wayfair decision that states can collect sales taxes from online businesses even if they do not have a physical presence in the state, and California (like many other states) begin collecting those this week. But California isn’t content collecting such taxes from that date going forward. It wants to get every cent it can from businesses going back years before that.

To do so, the agency is taking a novel and highly controversial reading of what it means to have such a presence in our state. “Your nexus in California may have been established because you use Fulfillment by Amazon services for sales you make over the Internet and some of your inventory is stored in fulfillment center warehouses in Californian for delivery to consumers in this state,” according to a CDTFA letter quoted by TechRepublic. The agency also is demanding that Amazon hand over private information from these companies.

In other words, California is saying that businesses in Washington, Mississippi, and elsewhere actually had a presence in California because — unbeknownst to them — the Amazon fulfillment service may have stored their product in a warehouse somewhere in, say, the San Joaquin Valley or the Inland Empire. Treasurer Ma, who is one of the few statewide officials with a history of standing up for California’s taxpayers, calls this action “unlawful, unconstitutional and impractical.”
https://spectator.org/california-may-be-coming-for-you/

Comments 1 - 15 of 15        Search these comments

1   Shaman   2019 Apr 4, 9:11am  

Considering that California’s police have no jurisdiction over any other state, just refuse to pay and stay out of California.
I did that with a traffic ticket once. Still haven’t been arrested for non payment.
2   HeadSet   2019 Apr 4, 10:38am  

Internet sales are no different than old time catalog sales. The sales tax should go to the state where the package was sent.
3   RWSGFY   2019 Apr 4, 10:54am  

No, don't stop selling to us! We need our high-cap MAGAzines!
4   anonymous   2019 Apr 4, 11:35am  

MLTC - people moving out of the state of California need be very diligent to permanently remove all traces and ties of themselves to California lest the state come looking for them for tax purposes - they will look too, diligently. When I moved out in California I had advice from accountants etc. to make sure I did not get caught up in something.

Don't think your in the clear also, if they do not come after you within the first 12 months....leave nothing no matter how small that can be used as some link to California the state can "determine" that "proves" you were a resident there.

Also if you filed a permanent change of address with the Post Office upon moving out of California, you really want to hang on to that documentation as a form of proof when you left etc.

They are also notorious for going after people on TDY assignments whose domicile is in another state. There are limits to how long one can stay without a short break out of state before California decides you were a permanent resident for a particular tax year. Miss the cutoff be even one day and they will be after you.
5   anonymous   2019 Apr 4, 11:35am  

Quigley says
California’s police have no jurisdiction over any other state


The tax weasles do
6   Entitlemented   2019 Apr 4, 12:09pm  

California pays pensions on a ponzi promise of 6-8% returns on the pension investment. There has been runaway pension costs since then. This promise of 6-8% was done without sufficient diligence, but never the less is in play.

I am concerned about how the Populace would pay for such un sustainable benefits.

Now to pay for such scheme, it may be required to have taxation schemes matching the 6-8% magical returns that did not occur.

California is a naturally beautiful state - but what the governance has done should be righted for the people instead of perpetuating this fraud.
7   zzyzzx   2019 Apr 4, 12:12pm  

I'm guessing that CA only went back 8 years because that's how old that companies online business is???
8   zzyzzx   2019 Apr 4, 12:12pm  

Stop Selling to California

Or charge more to CA residents.
9   anonymous   2019 Apr 4, 12:30pm  

Entitlemented says
I am concerned about how the Populace would pay for such un sustainable benefits.


Unless something has changed in the last 12 months or so - California will never ever be able to dig it self out of the deficit hole where CALSTRS and CALPERS pensions are concerned and the situation is getting more dire with each passing month and year.

Regardless of what ever "balanced" budget shenanigans come out of Sacramento - they all fail to take into account how far in arrears these two pensions programs are.

At present even advanced tax schemes will not get the job done. For all intents and purposes the only way out is to declare insolvency and massive cuts to whatever was promised.
10   SunnyvaleCA   2019 Apr 4, 1:45pm  

I'm surprised CA hasn't figured out how to obtain the credit card transactions of residents. Then just go down the transaction list and force the taxpayer to prove they paid use tax on each out-of-state transaction. They could, for example, just look for transactions from the top 10 biggest out-of-state sellers. (BH Photo Video, for example).
11   Shaman   2019 Apr 4, 1:56pm  

I’ve been trying to tell you guys...laws that aren’t supported by the people are not only invalid but unenforceable. California bureaucrats can declare wherever they wish, but unless people comply with their demands, or they find enough enforcers to force compliance at the point of a gun, they’ll just be empty threats.

Just tell them “the check is in the mail.”
12   RWSGFY   2019 Apr 4, 2:21pm  

SunnyvaleCA says
I'm surprised CA hasn't figured out how to obtain the credit card transactions of residents.


That would require a court subpoena, methinks. Can you imagine any court giving a blanket subpoena to obtain bank records of 20 mil people?
13   Booger   2019 Apr 4, 2:36pm  

Hugolas_Madurez says
Can you imagine any court giving a blanket subpoena to obtain bank records of 20 mil people?


If the judge has a CA pension on the line, yes.
14   Ceffer   2019 Apr 4, 2:44pm  

Maybe they can hire all those spare change muggers they allow to frenzy and harass at the LA Airport to be tax collectors.
15   RWSGFY   2019 Apr 4, 2:55pm  

Booger says
Hugolas_Madurez says
Can you imagine any court giving a blanket subpoena to obtain bank records of 20 mil people?


If the judge has a CA pension on the line, yes.


He'll be slapped silly by SCOTUS.

Please register to comment:

api   best comments   contact   latest images   memes   one year ago   random   suggestions