California Governor Considering Internet Sales Tax Proposal

After years of adamantly rejecting an Internet tax plan that he said would slow the growth of the dot-com economy, Gov. Gray Davis is now willing to consider a proposal that would force many online companies in California to charge state sales tax. In a significant shift, a Davis spokeswoman said the governor is willing to consider an Internet sales tax -- the first of its kind in the nation -- to help fill what he estimates is a $34.6 billion budget shortfall over 18 months.