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SALINAS, Calif. --A new California law is requiring Amazon and other large Internet retailers to start charging you a sales tax, just like brick and mortar stores.
Right now states across the country estimate they lose about $11.5 billion dollars a year in uncollected sales tax from online purchases. Now Central Coast cities are hoping to get a piece of that pie.
In September, the sales tax law took effect and the board of equalization surveyed over 200 potential retailers that would be required to tax California customers online. So far only 16 have made the cut.
But just in the first 15 days of the law $11.9 million in sales tax was collected from newly registered stores. Now, local cities, like Salinas are hoping that trickles down.
We talked to Salinas Mayor Dennis Donohue in August before the law took effect and he said a cut of the money given to local cities could go towards putting more officers on the streets. Now that the law is written, Mayor Donohue said the city is not depending on the money because it's not sure how much the city would get. "You have to kind of view it as found money or new money," said Donohue.
The new law applies to stores like Amazon who are out-of-state sellers that make more than $1 million in annual sales to the state, with an affiliate site in California that makes more than $10,000. L.L. Bean and Overstock.com are stores exempt from the law because they ended their affiliate program in California.
Mayor Donohue said once the city knows how much it will get and that number stays consistent they can plan to use it. "Focus on a core group of basic services, whether it's police, fire, parks and then public works and the general appearance of the city," said Donohue.
