Starting Sept. 15, out-of-state online retailers like Amazon.com will be required to collect and remit sales tax in California.
Supporters of the bill say it will put all companies on equal footing when it comes to tax collection.
The change is expected to generate over $500 million in state revenue each year.
Most Californians don't know they're supposed to pay the equivalent of a sales tax on their state income tax filings under "use tax." The state estimates it loses out on more than $1 billion every year.
Without the "E-Fairness" bill, the state has been relying on your honesty to come clean at tax time.