Last week, in an effort to create a balanced budget and some fiscal stability in California, Gov. Jerry Brown and the Democrats in the Legislature finally passed a budget over continued Republican intransigence over the Democrats' desire to raise revenues rather than cut services like K-12 schools.
Democrats sidestepped Republicans by finding a means to generate revenue without raising taxes (in fact, sales tax rates are down now) by closing a loophole in the law that had allowed Internet giants like Amazon.com and Overstock.com to avoid collecting sales taxes on their Internet sales. It is estimated that closing this loophole will add $317 million to the treasury.
Currently, Laguna Beach contributes about $25 million in sales tax revenue based on the current 7.75% tax rate. The Board of Equalization estimates an additional $500,000 in sales tax revenue would be collected from Laguna Beach under the new law.