California Senate revives bill requiring sales tax on online purchases

SACRAMENTO, Calif. — The California Senate on Thursday passed a bill that would require Amazon.com and other online retailers to charge sales tax on purchases in California, generating an estimated $107 million a year.

Gov. Arnold Schwarzenegger vowed to veto the measure when Democrats proposed it last year, and it stalled in committee. But Democrats reintroduced it Thursday in a tax enforcement bill that was part of a $5 billion budget package moving through the Legislature.

Schwarzenegger has not indicated a change of heart on the issue. "The governor has never supported this proposal, so it would be a very tough sell," spokesman Aaron McLear said Thursday.

The governor’s reasoning last year was that Amazon, Overstock and other online retailers provide employment to hundreds of so-called "affiliates" in California who direct sales to the Web sites.

Advocates for the tax say retailers would merely collect a use tax that Californians are supposed to pay already.