The current 75-year-old law authorizes sales-tax collections on tangible personal property. Downloads are not considered tangible under current law.
"The notion of taxing tangible, physical property is really an industrial-era construct when we made widgets and sold widgets," Calderon said Friday. "Now it's not about widgets, it's about information, and selling information and moving information."
Calderon's proposal has generated some opposition in the legislature.
"One of the growing parts of our economy, tech online and Internet, is something we should encourage without having these types of taxes," said Assemblyman Guy Houston, R-Livermore.
It's unclear how much money the download tax would generate. The Board of Equalization believes state and local revenues would increase by about $114 million a year. Calderon's estimate, which he said includes adult material downloads, is about $500 million.
Even if passed, the tax could face problems in the courts.
Board of Equalization member Michelle Steel said that if downloads are redefined as tangible property, transactions would be subjected to an automatic tax not authorized by the Legislature, which could invite a legal challenge. Under current law, taxes proposed in the Legislature can be raised only with a two-thirds vote of the Senate and Assembly, which is nearly impossible because of traditional Republican resistance to taxes.
The measure will have a hearing before the tax and revenue committee April 14.
