Eric Von Berg - Newmark Realty Capital - 595 Market Street, Suite 2550, San Francisco, CA 94105 - for loan quote: 415 956 9922

July 8, 2011

Time to boycott

A key component of California’s 2011-2012 budget is to require online retailers to collect sales tax. Amazon is not taking this lying down and sent an email June 29th, 2011 severing ties with all its California affiliates (not me - "Capital Wisdom” has no sponsors or advertisers). Amazon is refusing to pay the tax and is preparing a legal challenge.

It is time for us to say, “Enough!”  And, we in the commercial real estate industry need to be the loudest voice. 
We, who make our living from the bricks-and-mortar industry, see the effects of an uneven playing field on retail tenants.  Our bookstore chains are dead or dying and our electronics stores are sick.  You can download a bar-code-reader app to your smart phone, stand in the aisle at Best Buy and with a few clicks, order that exact model flat-screen TV from Amazon, delivered to your front door and save tens or hundreds of dollars in taxes. 

Competition is great, but true competition requires a level playing field. 
Bricks-and mortar retail stores pay rent to our industry.  But more than that, they pay sales tax and property taxes to our States and local communities; they hire our young people; they sponsor our little league teams and support local causes and charities. 

You might think a bricks-and-mortar retailer could open its own on-line outlet and achieve the same benefit as Amazon.  No; they can only avoid collecting sales tax if they have no stores in that state. 

The consumer is responsible for paying its own sales taxes on on-line purchases.  A system that requires people to voluntarily tax themselves: How stupid is that?

Write to your Congress person
Tell them to pass legislation to require all on-line retailers to collect sales tax based upon the sales tax-rate for the zip code where the goods are to be delivered.   Tell Congress to ignore the screaming that “This is too difficult!” These are automated systems – it's not that hard to do.

When retailing started, the San Francisco Bay Area was a center of this activity.  At that time I supported a special status for these retailers.  Ignoring sales tax was a way to get this fledgling industry born. went live in 1995; it is now a 16-year old:  We have a powerful, self-centered and headstrong teenager on our hands. Time to grow-up.  Time to shop local. Time to boycott