$1 billion in use taxes go unpaid

February 28, 2011

About $1 billion in use taxes go unpaid every year in California, according to a report issued to lawmakers today from the nonpartisan legislative analyst.

Use taxes are similar to sales taxes but are typically charged on out-of-state purchases, many of which are made over the Internet. Unlike sales taxes, which are collected by the seller and sent to the state Board of Equalization, use taxes are supposed to be paid by the buyer. But the legislative analyst says that the best estimate is that only about 1 percent of use taxes owed are ever paid.

Download the full report here.

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