June 30, 2011
Jerry Brown Demonstrates Democrat Tax Policy
Posted by Dave Blount at June 30, 2011 9:49 AM
Rather than take responsible steps toward climbing out of the hole it has dug itself into, California chose to return Governor Moonbeam to office. His response to the government-caused economic crisis demonstrates Democrat economics in a nutshell:
Gov. Jerry Brown has signed into law California's tax on Internet sales through affiliate advertising which will immediately cut small-business website revenue 20% to 30%, experts say.
The bill, AB 28X, takes effect immediately. The state Board of Equalization says the tax will raise $200 million a year, but critics claim it will raise nothing because online retailers will end their affiliate programs rather than collect the tax.
Maybe it won't raise any revenue, but at least it cracks down on capitalism — and not only in California:
Amazon has already emailed its termination of its affiliate advertising program with 25,000 websites. The letter says, in part:
(The bill) specifically imposes the collection of taxes from consumers on sales by online retailers — including but not limited to those referred by California-based marketing affiliates like you — even if those retailers have no physical presence in the state.
Rebecca Madigan, executive director of the Performance Marketing Association, confirms that the damage won't be limited to the Land of Fruits and Nuts:
"This law won't impact Amazon that much but it is a crisis for website owners who make revenue by placing ads on their websites for thousands of online retailers. Most of them don't have a physical presence in California."
Why would even a malignant kook like Jerry Brown support driving up unemployment still further when it won't produce any revenue? Here's a clue: he's a Democrat. What can't be explained by sheer malice usually involves crony capitalism:
California Retailers Association stated: "We thank Governor Jerry Brown and the leaders in the California State Legislature who have demonstrated their leadership and commitment to California businesses by passing and signing e-fairness into law. Small and large businesses across the state have been held at a major disadvantage by the current law that out-of-state online companies like Amazon.com and Overstock.com have exploited for years."
Apparently Brown broke the legs of small-time Internet entrepreneurs who can't afford massive campaign donations on behalf of their more generous big-box dinosaur competitors.
The reason Democrats ignore the Laffer curve, which shows how the higher they raise taxes beyond a certain point the less loot it will produce, is that taxes are not about money for them. Comrade Obama has advocated increasing capital gains taxes even if it decreases revenue. As the Moonbat Messiah might put it, the true purpose of taxes is to "punish our enemies, and … reward our friends."
On a tip from G. Fox.