Reacting swiftly to an online sales tax signed into law Wednesday 6/29/11 by Gov. Jerry Brown, Amazon.com and Overstock.com announced they are severing their relationships with California affiliates to avoid having to collect the tax.
Under federal law, states can require online retailers to collect sales taxes only if the seller has a physical presence in the state. California law requires residents to pay taxes on all online purchases, but many consumers don't, giving Amazon and other online retailers that don't collect the sales taxes an advantage over big-box retailers and other brick-and-mortar stores.
MORE