Tax on music downloads

[xoxoxoBruce]

California, trying to cover budget shortfalls, are looking at new taxes.

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.

Of course far more important, the following proposal...

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).