Now You Have It, Now You Don’t : Law establishing sales tax on periodicals hits universities and public libraries in the purse

Sacramento made the case this year for tax increases where they were needed to prevent important public services from shrinking or dying.

That’s fine--but how about a little consistency?

After all, for a state that has staked so much of its future on maintaining a lead in high technology and global trade, few services are as important as education.

Yet that is precisely the area where a new state tax will have the perverse effect of cutting a key public service. Sacramento’s decision to extend the state sales tax to periodicals will reduce the buying power of university and public libraries around the state by $4 million a year.

Giving funds for programs with one hand and taking them away with the other could hardly have been what Sacramento had in mind. Surely the Legislature will want to stop this fiscal merry-go-round at the earliest opportunity.

State Sen. Quentin L. Kopp (I-San Francisco) cured a tiny fragment of the problem with a bill that Gov. Pete Wilson signed that exempts some periodicals from the tax. This law exempts nonprofit institutions from paying a sales tax on periodicals produced by other nonprofit organizations or on those with no ads.

But that does not go nearly far enough. As one spokesman at the University of California pointed out, somebody would have to go through the publications to check for advertising and then auditors at the state Franchise Tax Board probably would want to look for themselves to guard against cheating.

Times writer David Smollar reports that inflation and budget cuts already had reduced buying power at major campuses in the University of California system in recent years. The sales tax cuts the funds that UCLA can invest in scholarly journals and other periodicals by $300,000 more.

UCLA is the hardest-hit campus, but Berkeley and Davis both would lose nearly that much and the San Diego, Irvine and Santa Barbara campuses all would lose nearly $200,000 each in purchasing power.

The 20-member California State University system will pay an additional $1 million, with the tab at each campus depending on the number of students and the size of the library collections.

It makes no sense for Sacramento to tax purchases made with state money to begin with. It’s a robbing-Peter-to-pay-Paul scenario that legislators should cure in short order.