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Taking Aim At Online Retailers

A recent report by the non-partisan public policy group says the state loses more than $1 billion each year in uncollected taxes on internet sales. The California Budget Project study found online sales rose 500 percent in the past 10 years. Retail sales only grew 27 percent during the same period. The report finds companies that don't collect sales taxes have an unfair advantage over California business firms.

"A lot of the associations of these California-based small businesses are coming together to help find a way to solve this problem because for many of them it is a life or death issue," according to California Budget Project President Jean Ross.

California lawmakers have struggled with the issue for several years. The legislature has tried to recover the sales-taxes revenue, but large online retailers like fought the move. That company threatened to cancel contracts with California firms if sales tax legislation passes.

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