California Tries to Drive Online Retailing Out of the State

This will not end well:

The last of three bills aimed at getting the Seattle giant and other out-of-state online retailers to pay sales tax passed the Assembly on Wednesday afternoon.

“It’s something we’ve been working on for years,” said Assemblywoman Nancy Skinner, D-Berkeley, who authored the bill. “But this is the first time that so many businesses up and down the state are supporting it.”

A companion bill, authored by Assemblyman Charles Calderon, D-Whittier (Los Angeles County), passed the full floor on a 47-16 vote on Tuesday.

“This bill levels the playing field for businesses in California,” said Assemblyman Bill Berryhill, R-Ceres (Stanislaus County). “Not a day goes by when I don’t hear from businesses about their ability to compete.”

Which is what supporters of the so-called e-fairness legislation have been shouting from the rooftops for years, despite vetoes from former Gov. Arnold Schwarzenegger and dire threats from Amazon.com (2010 profit: $34 billion) and Utah’s Overstock.com to pull their affiliate business out of the state.

I guarantee you this bill comes with all kinds of rosy assumptions about the tax revenue it will generate, and it probably won't make half that amount because the big online retailers will simply cancel their affiliate agreements in California and refuse to do business here. And people aren't stupid. They'll find ways to get the stuff they want without paying California tax even if it means having someone out of state order it for them. California will be worse off if this bill becomes law.