"If we don't do some of these things, we are going to have to cut nearly $5 billion out of schools," said Assemblyman Charles Calderon (D-Montebello), chairman of the Revenue and Taxation Committee. He has proposed some of the Legislature's more unconventional measures, including taxes on digital downloads and adult entertainment.
Calderon said he was moved to push for levies on downloads such as iTunes because state sales tax laws do not reflect the high volume of purchasing that Californians do online. Consumers can download music from the Internet through Apple's iTunes and other services tax-free, Calderon noted, while they pay sales tax for buying the same music on a compact disc at a store.
His proposal would empower state authorities to collect sales tax on the downloads, increasing the cost of a typical 99-cent song to roughly $1.07. Calderon projects that the bill (AB 1956), which could also apply to pornography downloads, cellphone ring-tones, online books and feature films distributed on the Internet, would raise about $500 million for the state budget.
The idea stalled in committee this month in the face of fierce industry opposition. But like the other proposals, it could be revived at any time, most likely when legislative leaders hammer out a budget agreement this summer.
Calderon said the resistance to his bill did not surprise him. But he is perplexed that he hasn't been able to get more traction for another proposal: a 25% tax on sex toys, strip shows, pornographic magazines and videos and anything else sold in an "adult entertainment venue."
"This is a major industry that is putting a disproportionate burden on state services," he said. "Drugs are heavily used. The actors have a short life span. Some leave the industry drug-addicted with no skills. They wind up availing themselves of Medi-Cal and other state programs."
A coalition of porn stars, strippers and others in adult entertainment roamed the halls of the Capitol recently to lobby against the Calderon bill (AB 2914).
They have beaten back similar proposals in the past, typically with the help of anti-tax activists, who say that if levies are imposed, the industry will move elsewhere and jobs will be lost.
Assemblyman Mike Davis (D-Los Angeles) is targeting a wider group of consumers. Almost every Californian would bear some of the brunt of his proposal to charge a 25-cent tax on every plastic carryout bag from stores.
