California Democrats approve state budget bill that requires online retailers, such as Amazon, to collect state sales taxes; change projected to net US$200M/year to reduce US$11.4B deficit
June 15, 2011
– The budget bills Democrats approved Wednesday include a combination of tax and fee increases, spending cuts and revenue assumptions. Democrats and Gov. Jerry Brown previously took steps to reduce the state's deficit by $11.4 billion, primarily through spending cuts.
Here are some of the key provisions of the latest bills:
Taxes and fees:
— $12 annual fee on car registrations to pay for Department of Motor Vehicle services. The department's costs previously were covered by a voter-approved increase in the vehicle license fee increase that expires July 1.
— $150 annual fee on homes in rural areas that depend on the California Department of Forestry and Fire Protection for wildfire protection.
— A quarter-cent local sales tax. A 1 percent increase in the state sales tax is scheduled to expire June 30, so consumers would see a net reduction of three-quarters of a cent in the sales tax they pay on goods.
— Requiring online retailers such as Amazon.com to collect California sales taxes, a change projected to net $200 million annually.
Additional spending cuts:
— University of California, $150 million.
— California State University, $150 million.
— California courts, $150 million.
— County offices of education, $50 million.
— $1.2 billion from selling and leasing back 11 state properties, under more favorable terms than a plan Brown previously rejected. The state would be allowed to repurchase the properties when the lease deal expires.
— $1.7 billion by restructuring local redevelopment agencies.
— $816 million increase in additional tax revenue projected from a recovering economy.
— $1 billion from First 5 commissions for early childhood development, despite an ongoing legal challenge.
— $3.4 billion in delayed payments to schools, community colleges and the University of California.
Read more at the San Francisco Examiner: http://www.sfexaminer.com/news/california/2011/06/democrats-budget-bills-glance#ixzz1PStoSqC6
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