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Ban on Internet Taxes to Expire
slacknet writes: "Well, it looks like the government could be lifting the ban on taxes related to the Internet, CNN reports here. While the House of Representatives has already passed a two-year extension on the ban, the Senate has not. Newsbytes.com also has an article on this matter here. I'm sure I'm not the only one who thinks this probably isn't the best time economically to be discussing any sort of additional taxes." I think Newsbytes has it right - the federal ban is likely to be reinstated soon, they just didn't get around to it this week.
Nolo.com has a nice short primer on Internet taxation issues, with plenty of additional links for more breadth.
As this NYT article suggests, the taxation ban expiring will have little effect in the short to medium term, as the ban itself was really very limited in scope, and no local politician wants to increase taxes, especially to affluent voters who would be primarily affected.
evanchik.net
If you want to kill whats left of "dot coms" and online commerce, begin taxing it nationwide. I usually can find certain things online cheaper than in a store even with shipping figured in, however if you add tax it's going to be nearly the same, or more. So it'll just be worth going and getting it and having it "now", so yeah, they need to get their act together and instate the extension.
..There's a-dooin's a-transpirin'
A bad idea right now to be sure, but for the long haul, having exemptions for net trading is maybe not such a good idea. It does penalize local merchants, and gives rise to a whole lot of unnecessary transports. Some framework is needed so that local governments can decide on this without creating scewed markets (just deciding whether taxes should be paid at the salesman's or customer's jurisdiction would go a long way).
OK, I'm ready to get flamed...
/Janne
Trust the Computer. The Computer is your friend.
The Senate did not pass the extention because they want to setup a method to tax internet based sales while still banning internet access taxes.
They are changing the rules because many states want a cut of the money that the few successful on-line businesses make.
If on-line businesses must pay sales tax on every sale, then mail-order companies should have to do the same. But I agree that there should be no new internet taxes of any kind. No taxes on sales or Internet access. It is too soon.
Contact your congressperson at Congress.org or via the site of your choice.
Although we bash the house a lot, it is quite significant here. In terms of Federal taxes, what the house says goes. After all, all tax bills must originate in the house, so if the Federal government was planning on taxing the internet, we needn't worry. "All bills raising revenue shall originate in the House of Representives..." (Article I, section 7)
If people are worried about State Taxes, which could theoretically be passed if no Federal law prohibits them, they should also relax. As you know, states can only tax intra-state commerce. THey can't tax anythinhg at the comes in at thier borders under any circumstances. So, very few internet transactions are at risk here. Also, considering it would probably be difficult to argue that anything you do over the internet is entirely within one state. (Did you use a router in another state?)
FInally, in the current economic climate, I can't imagine any government would ever want to pass a law discouraging commerce.
I don't thing we have to worry about this,
--Alex Fishman
I can call a catalog, say PC Connection, and buy something without being charged any taxes.
I wonder if this could be used to get around Internet sales taxes. I could add things to my shopping cart, receive a "pin code", call a toll-free number, punch in my credit card number and my sale is now a telephone sale and not an Internet sale.