California Use Tax Collection Efforts Increasing

Lately many consumers have been purchasing items online from out of state vendors either for convenience, better price, or for a break on paying the California sales tax.  However, California law requires these taxes be paid to the State.  Since 1935, residents of California are held responsible in paying for the use tax, which would equal the sales tax rate in the city in which they reside on anything purchased outside of the state. If the retailer is not required to collect and report the use tax, it is the buyers responsibility to directly pay the tax.  Under federal law, online retailers must report purchase information to the state tax collector.   Recent news reports indicate the State Board of Equalization has billed consumers for unpaid taxes and penalties.  Specifically targeting out of state internet purchases of cigarettes during the recent fiscal year, the State's billings have totaled about $1.6 million.