California Hits E-Fairness Delay; Illinois Vote Expected Today

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This week in California the e-fairness provision in the legislative budget was temporarily tabled when lawmakers decided to split the proposed budget into several distinct bills. However, the development did not derail sales tax equity efforts in the state. In Illinois, the Senate Revenue Committee is poised to vote on sales tax fairness legislation, following a hearing that is scheduled to include testimony from an ABA bookstore member. In Virginia, a proposed e-fairness budget amendment is expected to come up for a vote sometime next week. In Colorado, members of the House of Representatives passed a uniquely amended version of sales tax legislation that focuses on consumer use tax compliance.


As previously reported in BTW, as part of the emergency budget session in Sacramento a provision has been added to the proposed legislative budget that would clarify state sales tax law. The provision would ensure that non-California retailers with online affiliates in the state acting as sales agents collect sales tax on purchases shipped into California.

Initially, it was expected that legislators would vote on the proposed budget in the next two weeks. However, during a special session, the proposed budget was divided into several distinct bills and, to satisfy the requirement that there must be some action during a special session, budgets dealing with cash flow and cuts totaling about $2 billion were sent to Gov. Arnold Schwarzenegger. A tax enforcement bill, which contains sales tax fairness legislation, and another bill were temporarily tabled in the Assembly. While it is expected that the tax enforcement bill will be heard by the legislature by the end of June, it is unclear whether any action will be taken on the two bills before the special session closes. 

"This delay provides us with a tremendous opportunity to broaden our coalition and demonstrate the strong statewide support for this important provision in the budget," said ABA CEO Oren Teicher. "It's very important that booksellers continue to spread the word to their retailing neighbors and ask them to write to the governor. And I urge any booksellers who have not yet written to the governor to do so. "

Booksellers can find a sample letter to the governor in the California E-FACT section on Booksellers who have any questions should contact ABA's Senior Public Policy Analyst David Grogan at [email protected] or (800) 637-0037, ext 6662. ABA also asks that booksellers notify Grogan when they have sent their letter. This will compile information to support this lobbying effort.


At press time, the Senate Revenue Committee was expected to vote today on SB3353, e-fairness legislation that would clarify sales tax laws so that out-of-state online retailers who earn more than $10,000 through online affiliates in Illinois would be considered to have a physical presence in the state. Bookseller Roberta Rubin of The Book Stall at Chestnut Court in Winnetka, Illinois, is scheduled to testify at the hearing regarding how the current sales tax inequity is negatively affecting her bookstore.

Look for an update on the vote and the next steps for SB3353 in next week's BTW.


Though a House of Delegates subcommittee recently voted down e-fairness legislation, Sen. Charles Colgan has added an e-fairness amendment, SB30, to Virginia's proposed budget. If SB30 is in the final budget, out-of-state online retailers with nexus in the state via online affiliates would be required to collect Virginia sales tax on sales to Virginia residents, thereby leveling the playing field for the state's bricks-and-mortar businesses. 

"Despite the setback in the House subcommittee, the letters, e-mails, legislator visits, and testimony have made a big difference in the fight for sales tax equity in Virginia, as we can see by this latest development," said ABA's Teicher. "But it's essential that booksellers let their delegates know as soon as possible that they support sales tax fairness."

Booksellers are asked to e-mail or call their delegate and urge him or her to support Senator Charles Colgan's amendment, SB30, in the proposed budget. 

To help booksellers in this important advocacy outreach, ABA and the Southern Independent Booksellers Alliance (SIBA) have prepared a template letter that booksellers can adapt and e-mail to their delegate. (If you are e-mailing your letter, be sure to include your store name and complete address. If you call your delegate, the template letter can be used as talking points for your conversation.) 

Booksellers should contact ABA Senior Public Policy Analyst David Grogan at [email protected] or (800) 637-0037, ext. 6662, when they have sent their letter. This will help ABA and SIBA compile information to support this lobbying effort. 


In Colorado, members of the State House of Representatives have passed a uniquely amended version of sales tax legislation that focuses on consumer use tax compliance. On February 24, Gov. Bill Ritter signed the bill into law. ABA has stated publicly that it will await more details on how the sales tax bill, HB10-1193, will be implemented, and, "should the Colorado solution prove an ineffective remedy, we will actively continue the fight for sales tax equity," said ABA's Teicher. --David Grogan