Of course there is a different between renting a movie and watching one on your computer via the Internet. When renting, the customer pays a certain amount of money, is handed a physical product and walks out the door. Both the business and the customer used public services such as roads and sidewalks to make it possible for that transaction to occur, and the state want a slice.
But if someone pays for a service such as Netflix, located in California, and they watch an episode of "30 Rock" with their computer, how much should they be taxed and what are they being taxed for?
Here's the full text of Hunter's House bill 2075
Rep. Hunter's Web site