“Apple’s iTunes has been nothing short of revolutionary. For just 99 cents, you can download almost any song onto your computer or iPod. For a few more dollars, you can rent a movie or buy an episode of your favorite TV show,” Brian Joseph reports for The Orange County Register.
“The service has become so ubiquitous that last month iTunes was named the nation’s second largest music retailer, behind only Wal-Mart,” Joseph reports. “It is a money machine – and our Legislature appears to have noticed.”
“You see, music and movies purchased on iTunes differs from those purchased in stores in one very significant way: it’s not taxed. California law explicitly restricts sales tax to ‘tangible’ goods – i.e. products that can be ‘seen, weighed, measured, felt or touched,'” Joseph reports. “A digital file, obviously, isn’t any of those things.”
“But the state faces an $8 billion deficit. The Legislature needs money. So it’s looking to iTunes,” Joseph reports.
“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,” Joseph reports.
“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,” Joseph reports. “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.”
Joseph reports, “Voila! A new tax – without a 2/3rds vote.”
Full article here.
Did Apple create California’s budget crisis or did California’s legislature spend way, way, way more than it took in for years? Perhaps before taxing California’s consumers and taking a bite out of one of the premier California-based employers, the legislature should first look to reign in their massive, wasteful spending habits? You know, get your business in order first before you look to disrupt the well-performing businesses of others. Just a logical thought. We now return you to reality and the illogical thought patterns of California legislators.
Apple ought to noisily explore Arizona real estate opportunities. That would put an end to this sort of stupidity immediately.
[Thanks to MacDailyNews Reader “Bill M.” for the heads up.]
Hey MDN, you watch your comments. Somebody has to pay for Mayor Newsom’s immigration policies and he is too cool to pay himself.
Just my $0.02
P.S. 118 MB patch to Office 2008 just arrived.
Tax & spend politicians. idiots.
How about you stop supporting drug using fatherless baby making machines. That’s at least a start.. then look at your salaries. Only after you look to yourself can you start taxing me EVEN MORE..
Every chance you get, ask any elected official how many government employees they intend to lay off during their tenure.
My iTunes Store purchases (downloads) have always been taxed here in Washington, DC. I thought that was the case everywhere that Apple has a physical presence — they must abide by the local sales tax rate. Unlike, say Amazon, which does not have a physical presence here, and nothing is taxed when purchased from them. Californians have been getting off easy if they’ve had this arrangements for so long on so-called “intangible” goods!
@Aldebaran
I live in Kansas, no iTunes tax here.
California might be bad, but come to the great state of Maryland. We tax everything possible and try to run companies out of state.
Before this turns into a Dem/Repub thread, all politicians suck.
Oh, but we can’t CUT anything in California……..we just need MORE money. That will fix everything. Fix the educational system, it will fix health care, hell, it even fixes erectile dysfunction.
With Gas prices here in California well over $3.50 a gallon, there is NO WAY I’d support raising ANY taxes at all.
The key here is exactlly how the law would be written. If some one in CA bought software from a company in Texas and had to pay Texas sales tax, would they have to pay CA sales tax too??
That is one of the problems now with internet sales. Its a matter of who gets the money. Every state wants your money, and they do not care if they deserve it or now.
Greedy govt. 🙁
Typical left wing “Tax & Spend” libs. Feed at the public trough and tax everyone else. We’re doomed.
Poor California.
First Reagan has the Contra’s infect it with cocaine (which propagates and spreads gang culture throughout the entire country) in order to fund the Contra’s.
Then Bush’s buddies suck billions from them in an energy scam called ENRON.
It’s clear that republicans are willing to sacrifice California in a way that fits their agenda, even if the agenda is completely illegal.
I live in Arizona and am taxed on iTunes purchases. It’s dumb but if CA would appoint all the iTunes taxes to the educational budget maybe the state wouldn’t be laying of 16k+ teachers next fall.
maybe more companies should move out of california — let the brain drain speak volumes to the legislature of california
We have to pay tax on itunes purchases here in NJ. The corrupt politicians (mostly Dems) have ruined this state. I dont purchase as many songs since the tax.
I guess Gray-Out Davis had nothing to do with California’s fiscal problems, huh? Blame everything on the feds and take no personal responsibility.
And Democrats wonder why so many people vote Republican/Independent. It’s because people get sick of working into late April and even May just to pay their taxes:
http://money.cnn.com/2007/03/27/pf/taxes/tax_freedom_statelist/index.htm
Californians have it worse than most US States… And it’s trending worse:
http://www.taxfoundation.org/taxfreedomday/
Folks simply shouldn’t have to work 1/3 of the year simple for taxes.
Instead of raising taxes when confronted with a budget shortfall they should be looking at ways of eliminating the burrocracy [spelling intentional]. When I have a shortfall of money, I cut back until such time that I have more money or look for a better paying job! Perhaps the California Legislature should consider doing the same [either one would do].
Not at all surprising to see Democrats are up to their usual tricks to get around a law designed to make it more difficult to pass taxes too. Were I a Republican or Independent in the California Legislature, I’d propose a bill that makes proposals to amending the definition of ‘tangible personal property’ to require a 2/3rd’s vote too.
Not that I am a big user of iTunes [I still prefer physical media when I have a choice] but I’m glad I don’t live there.
— Hano
Sshhh… Will you please keep it down??? New York may hear you. New York is a vacuum cleaner when it comes to taxes. 8% sales taxes, high personal properity taxes, AND such thing as a school tax. Not to mention high gasoline prices – one of the worst on the East coast. You would think with all this income somebody in Albany could balance a state budget.
(Okay, I now need to walk away, go take a deep breath, and count to X.)
Peace.
Take a good look at what will happen should we give the White House back to the Dems. Barack Hussein Obama and his VP Jeremiah Wright will jack up taxes and kill the economy at a time when we’re already struggling. No amount of ad space on this site will change that.
“Tax & spend politicians. idiots.”
unlike the brilliant “don’t tax, but go ahead and spend money you don’t have” right wing, right?
lets be fair. the right wing got the entire nation of the USofA in economic trouble. now when the left tries to save the budget they are the bad guys?
look, i don’t like the idea of taxing iTMS either, but to “amend the definition of ‘tangible personal property’ to include ‘digital property'” is pretty reasonable.
unless you want to claim that what you download is not tangible, and cannot be used, listened to or watched, this is pretty reasonable.
also, important rule, if you are from a “red state” where the money your state gets back in aid for things like gov jobs and road projects is higher than the total taxes your state pays, you are NOT allowed to complain about taxes. i hear one more moronic “anti-gobrment” tirade from some putz in south carolina or wyoming or some other “red-state” that would be a third world nation without the US government supporting its infrastructure, i am gonna puke.
so yeah ron, “Feed at the public trough and tax everyone else.” i agree, no more blue-state money to ignorant hicks. that would clear things up for me fine, how about you?
Yeah, blame the “tax and spend” Democrats. They’re so much more irresponsible than the “borrow and spend” Republicans.
I say blow it all on war and contributions to our cronies, and let our grandchildren sort it out.
There is still no sales tax on Limewire.
Obama the Messiah will save us all from taxes.
http://www.fuckthesouth.com/ says it better than i can….
Yes, let’s be fair. I don’t guess Bill Clinton had anything to do with floating the dotCom bubble which popped, or feel-good liberals telling banks they should loan money to unqualified people so they could buy a house or, probably more like it, buy too much of a house and now face the possibly of foreclosure because they can’t afford their adjusted mortgages.
Bush is no conservative. But Obama and Hillary and McCain all want to steal more of my paycheck. They all want the tax cuts to expire, which means they all want to raise taxes. And some want to raise gasoline taxes. Where’s the love the liberals all espouse?
Who is going to complain about the pork in the budget? Nobody, it seems.
Who would rather have oil money stay in the USA from drilling, pumping and refining our own? Or would they rather keep sending $100+ per barrel to Saudi Arabia and the rest? Why do they want to keep funding the middle east? Why do they hate American companies and Americans so much?
I’d better stop here before my rant gets out of hand.
We have always had tax on iTunes in Alabama. Just thought it was the norm kinda like going out and buying the CD or DVD.