Californians spend freely before online tax deadline

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LOS ANGELES — With Amazon.com set to begin collecting sales taxes on California purchases Sept. 15, many state residents are trying to cram in some last-minute tax-free shopping.

Depending on where they live, Californians pay 7.25 percent to 9.75 percent in sales taxes, so the savings are substantial — especially on big-ticket items like electronics. But bargain hunters are also stocking up on inexpensive goods.

Amazon won’t say whether sales to California customers have spiked in recent weeks. But judging from comments on social media sites and reportedly increased buying activity in other states before similar sales tax laws went into effect, many shoppers see these final days as an excuse to shop freely.

The buying binge comes after a drawn-out battle last year between the Internet giant and state lawmakers that ended with Amazon agreeing to start collecting sales taxes on purchases a year from then.

Amazon is not the only Internet merchant affected by the new law. But as the nation’s largest online retailer, it has been the main target. More than 200 other out-of-state companies with major business in California may also be on the hook to collect sales taxes on items shipped to the state.

The tax revenue from these online sales is being lauded as a win for the debt-ridden state, which estimates it will see an additional $317 million annually as a result; more than $83 million of that is expected to come from Amazon alone.

It’s also a victory for mom-and-pop shops and big brick-and-mortar retailers, including Wal-Mart Stores Inc. and Target Corp., which have complained for years about what they called Amazon’s unfair sales tax advantage.

Merchants including Best Buy Co. were especially hurt when shoppers would “showroom,” or check out products at the company’s stores, but ultimately buy them online to avoid paying sales taxes. Now they will be on an even playing field, they say.

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