More on Amazon.com

I just received a comment by a friend in the book industry He said:

“I hate to jump into the frying pan, but if my memory of living in California [pre-Amazon] serves me at all, I think Prop 13 is far more responsible for the mess the state is in now than tax on Amazon……”

It is a good question. Here is my response.

I’m glad you asked. Actually the economy is the most responsible for the mess, but you are right. Prop 13 has reduced the tax base dramatically.

That said, sales tax accounts for about 25% of the general fund, most of which goes to education and services to state and local. Amazon has been evading this tax for years now in spite of the fact that they have a clear physical presence in the state in the form of these associates. They promote Amazon very heavily and drive sales to Amazon and receive generous commissions.

In aggregate, lost taxes due to this have cost the state many billions of dollars. And the arrogance of A.C is startling. What they are really doing here is attempting to enlist their associates, many of which are schools and PTAs to support their tax evasion under threat of losing their Amazon revenue stream. They aren’t pointing out that the tax evasion practiced by Amazon is, itself, depriving the same schools of needed revenue.

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