California Now Collecting Sales Taxes From Online Retailers

RIVERSIDE (CBSLA) — You can say so long to getting a pass on sales taxes when you shop online.

Starting this week, companies are now required to charge you if you live in California.

"I didn't know. I didn't know. You guys really shocked me. You guys really shocked me today," said online shopper Rudy Sanchez.

If you order something online from merchants with a brick-and-mortar store in California like Target or Kohls, consumers pay California sales tax. But buying something online from stores that don't have an actual store in California, until now, didn't charge a sales tax.

California has now closed that loophole.

The state law changed on April 1. Now, it doesn't matter if an out-of-state company has a real store in California or not, online transactions include California sales tax.

"Oh no. I was like 'now we've gotta pay taxes,' " said Sanchez.

California's state sales tax rates are among the highest in the country.

"A lot of people are not going to be happy about that," said online shopper Xiomara Santamaria.

More than a decade ago, many online shoppers were aware they could get away without paying California sales tax on items from out-of-state retailers and took advantage of it.

Enough did, and online shopping boomed at the expense of in-store shopping.

In 2011, California's online tax law was modified and companies like Amazon, which had affiliates in the state, had to collect.

Now with the new law here, any out-of-state online shopping is taxed.

It's estimated California will collect about $544 million in the first fiscal year.