Have modern Californians forgotten the true value of media, its role in the state's incomparable history? Photos of/by Lurene, taken during visit to Hearst Castle, Library, 2007.
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Published news story by Lurene Helzer, April 21, 1999, Berkeley Daily Planet, “City eyes sales tax from ‘Net”. Berkeley discusses taxing local internet commerce of 1999. This was and remains a major financial issue inside California’s cities, and especially for small businesses that depend on pedestrian-generated commerce, like bookstores. I think my story was far too short.
Especially today, in the winter of 2009, this story gives a clue about why the State of California can not financially maintain itself as it once could. It sure can not collect revenues as it once did. This is a 1999 story, remember. Is it so stunning that ten years later we are seeing California fall into the sea, economically? That we are seeing incredible crimes that attract national attention in the San Francisco Bay area? I am not trying to blame it all on the internet, of course, but the influence of internet economics on California revenues has played a big part.
Further, I am not certain what any California leader can do inside the state without reasonable municipal taxes on internet transactions. I say this as a person who is today rather conservative: state, county and city employees must be paid each month and internet commerce needs to contribute its share.
I realize cities tried, but I sometimes think California missed a big opportunity with respect to the Dot-Com revolution in those years, that the state's leadership gave up too easily, and that Californians will continue paying for these financial errors in 2010:
The Berkeley City Council took steps Tuesday evening to join a growing movement of cities opposed to tax-free sales over the Internet.
Mayors across the country are complaining that their cities are losing valuable tax revenues because of Internet commerce.
“The mayors as a group have indicated they believe that sales over the Internet should be treated no differently than sales in our own local shopping districts,” read Mayor Shirley Dean’s report.
Dean, who sponsored the item, argues that sales tax represents one-third of all local revenue. She is proposing that Berkeley back a lawsuit against the federal Advisory Commission on Electronic Commerce, a lawsuit that is attempting to keep the commission from meeting or taking any action.
The city council unanimously endorsed her request to ask city staff to explore joining the lawsuit. The item was approved as part of the consent calendar, and there was no discussion by the council on the proposal.
The plaintiffs in the lawsuit are the U.S. Conference of Mayors and the National Association of Counties. They are charging that the representation of the federal commission, which heavily influences tax decisions by Congress related to the Internet, is tilted in favor of advocates of a tax-free selling zone on the ‘Net.
Patricia Wynne, who owns Berkeley’s Gaia Bookstore, supported Tuesday’s move by the council because of losses to booksellers like Amazon.com and Barnes and Noble.
“Whenever a business loses income, you know there are many factors,” she said. “But we believe that the Internet was a significant factor in our loss of income in 1998, because our sales dropped 40 percent in the month of November, which is the period that Amazon and Barnes and Noble began an intense advertising campaign that was highly critical of ‘real-bookstores’ and the kind of environment that people are accustomed to shopping in during the holiday season.”
Wynne, who serves on the national board of the American Booksellers Association, said that among bookstore owners there has been a lot of discussion about the federal exclusionary clause that allows online booksellers to avoid taxing customers on sales.
“It’s a government subsidy for Internet commerce,” she said.
In February 1997, Gaia had lost so much in sales that Wynne announced that the store would shut its doors.
“We stayed open because a community fund-raising drive was initiated by our customers,” she said.
Now the store survives due to a steady stream of benefits and fund-raisers.
“We’re determined and we’re creative and we’re enduring, but we’re losing business and it’s threatening the long-term viability of independent bookstores,” she said.
Wynne argued that the long-term effect would be a loss of business to Berkeley and would result in subsequent job losses.
“If you have job loss, then people have to go outside the city and spend money outside the city,” she said.
The U.S. Justice Department is defending the advisory commission because it is a federal entity. – end --
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