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SAN FRANCISCO (AP) - An appellate court ruling against Borders Group Inc. sets a precedent that could enable California to force some major Internet retailers to start paying state sales tax for books, music and other goods sold online to state residents.
Whether California tax collectors use the precedent to go after not only Borders but Barnes & Noble Inc., Amazon.com and other online retailers remains to be seen. But independent booksellers and other "bricks-and-mortar" retailers have been cheering, saying the ruling should remove their Internet competition's unfair advantage.
"There are a lot of online retailers who are watching this intently," said Tom Dresslar, a spokesman for the California Attorney General's office. "Clearly online retailing is growing so one would think the potential revenue problem is fairly substantial."
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