FRONT PAGE CONTRIBUTOR
The California Amazon Tax violates Props 25 and 26
Don’t our elected officials have access to Ballotpedia? If the California Democrats did, they’d know that the Amazon Tax being taken up this afternoon in the legislature is unconstitutional under the state Constitution. And it’s not some old, obscure provision that’s violated either. It’s the brand-new Proposition 26, a constitutional amendment passed in November, that the tax violates.
Put simply, Proposition 26 doesn’t let the state raise new revenue without a 2/3 requirement, so the Amazon tax cannot be passed with a simple majority. And no, Proposition 25, another constitutional amendment also passed in November, doesn’t change that fact.
Just today I was in an email discussion of the Amazon Tax. I myself falsely believed that Proposition 25 was a blanket removal of the 2/3 requirement for budget bills in California. However that’s not the case. So says the amended Article IV, Section 12(d), per Ballotpedia, with new text in bold:
(d) No bill except the budget bill may contain more than one item of appropriation, and that for one certain, expressed purpose. Appropriations from the General Fund of the State, except appropriations for the public schools and appropriations in the budget bill and in other bills providing for appropriations related to the budget bill, are void unless passed in each house by rollcall vote entered in the journal, two-thirds of the membership concurring.
The Amazon Tax is not an appropriation in the budget bill. It may be in the budget bill, but it’s not an appropriation. It’s a tax, per Proposition 26, which broadly expanded the definition of tax to include all sorts of fees and gimmicks. So says the amended Article XIII, Section 3:
SEC. 3. (a) Any change in state statute which results in any taxpayer paying a higher tax must be imposed by an act passed by not less than two-thirds of all members elected to each of the two houses of the Legislature, except that no new ad valorem taxes on real property, or sales or transaction taxes on the sales of real property may be imposed.
(b) As used in this section, “tax” means any levy, charge, or exaction of any kind imposed by the State, except the following:
(1) A charge imposed for a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the State of conferring the benefit or granting the privilege to the payor.
(2) A charge imposed for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the State of providing the service or product to the payor.
(3) A charge imposed for the reasonable regulatory costs to the State incident to issuing licenses and permits, performing investigations, inspections, and audits, enforcing agricultural marketing orders, and the administrative enforcement and adjudication thereof.
(4) A charge imposed for entrance to or use of state property, or the purchase, rental, or lease of state property, except charges governed by Section 15 of Article XI.
(5) A fine, penalty, or other monetary charge imposed by the judicial branch of government or the State, as a result of a violation of law.
(c) Any tax adopted after January 1, 2010, but prior to the effective date of this act, that was not adopted in compliance with the requirements of this section is void 12 months after the effective date of this act unless the tax is reenacted by the Legislature and signed into law by the Governor in compliance with the requirements of this section.
(d) The State bears the burden of proving by a preponderance of the evidence that a levy, charge, or other exaction is not a tax, that the amount is no more than necessary to cover the reasonable costs of the governmental activity, and that the manner in which those costs are allocated to a payor bear a fair or reasonable relationship to the payor’s burdens on, or benefits received from, the governmental activity.
Some may say the “use tax” qualifies under (b)(1), but roads and other state services are provided to everyone, including those who are just passing through and never pay a dime in sales or use tax. So if the Amazon Tax should pass today, and if Governor Brown does not veto it, then the Democrats in Sacramento have gotten together to defy the will of the people to fund their tax and spend habit. Shame on them.