Is New California Law a Reason for Clients to Market More?

By | July 8, 2011

The Lost Angeles Times has reported on a new California law that will require large online retailers like to collect state sales tax. This is great news for cash-strapped states looking to fix budget shortfalls. It’s great news for smaller, brick-and-mortar stores, too, because it eliminates one of the key reasons for customers to shop online rather than at local retailers.

Shopping at Inc. and other major Internet stores is poised to get more expensive. Beginning Friday, a new state law will require large out-of-state retailers to collect sales taxes on purchases that their California customers make on the Internet. . . The new tax collection requirement — part of budget-related legislation — is expected to raise an estimated $317 million a year in new state and local government revenue.

California’s decision is also reason for rejoicing among those producing digital print and other marketing services because it means more reason for your clients to spend money on marketing.  After all, why market to customers who are only going to shop online anyway? Taxing online retailers starts to close the gap on online retailers’ appeal. This makes “buying local” that much more appealing to consumers and, consequently, local marketing more appealing to businesses.

Right now, taxing of online commerce is only in California. What if other states follow California’s lead?

It’s nice to get some really good news for the printing industry once in awhile!

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2 thoughts on “Is New California Law a Reason for Clients to Market More?

  1. Sherman Rawding

    Taxes are a good thing?

  2. Noel Ward

    Glad I live in tax-free New Hampshire.

    Adding sales tax to an online purchase won’t necessarily shift anyone back to brick and mortar stores. Online is still usually less expensive, especially when the seller has deals on shipping.

    Still, local stores have to do more to entice customers, regardless of the tax issue. Smaller businesses especially have to really know their markets and work to build relationships with customers. And have an online presence to expand their net.

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