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Washington State Debates Taxing Software Creation
zzyzx writes: "An article in the Seattle PI discusses the existing tax on software creation in Seattle. The law was clarified recently to allow the taxing of the software that was created in Seattle, even if the manufacture of the discs occurred elsewhere. Some Washington state lawmakers are working to overturn these changes. The issue at the heart of the matter:
Should an intellectual activity such as programming be taxed in the same way as manufacturing is?"
Quote 1:Microsoft says Commercial software pays taxes
Quote 2:...Microsoft Corp., are pushing for an amendment to a municipal tax-reform bill to block the taxation of such intellectual property.
Microsoft's talking out of both sides of their mouth again.
Nothing new!!!!
What's that old saying - what's good enough for the goose is good enough for the gander? (That's gander - male goose - not gandolf, you goof!)
If they want to claim Intellectual Property is the equal of Real Property in terms of legal protections, etc., then they should carry the same tax burdens. Property tax, creation tax, whatever. It's time for that corporate free ride to end.
My only concern is that a poorly-written law that targets predatory monopolies could also affect sites that just provide Linux or BSD mirrors (if there's a tax fee per download), or worse would cover the "lone wolf programmer" who just wants to write a better widget for some OSS application.
More generally, there's the issue of whether other services are also taxed. I know some states charge sales tax on *everything* - including the hourly charge for the car mechanic and plumber, for the lawyer, etc. Again, this law should be fair - only tax programmer time if lawyers and accountants are also taxed. Only tax volunteer services if other volunteer services are taxed.
But on this particular issue, if the producer gets as pissed off at you sharing a copy of their software as they would if you set up a family picnic on their campus headquarters, then the IP and RP should either both be taxed or neither be taxed.
For every complex problem there is an answer that is clear, simple, and wrong. -- H L Mencken
That's a great move for Seattle! That will curb and eventually inspire negative growth in a huge sector of your local economy. A classic case of biting the hand that feeds you. OK, so that was sarcastic... but maybe that means that tech jobs will get spread around a little. Software development is one industry where the only resource you truly need is smart people. Unlike the chemical industry where you need things like cheap water and power, or auto industry with good transportation infrastructure. A good software company can equally exist in towns like Chattanooga, TN as it can in Seattle. Tax the software developers... they may not move right away due to large capital investments. However, they won't ever build a new investment in that community.
Does anybody really still not understand this? Companies do not PAY taxes, they COLLECT taxes. Business tax of any kind is just another expense that has to be built into the price of the product. Any legislator whose version of tax relief for us peasants is to tax those big old evil corporations is lying, plain and simple.
If we completely did away with all corporate taxation and replaced it with a national sales tax, properly calculated, the net cost of living would be the same. The differende would be that we would KNOW how much tax we were paying. Congress wouldn't like that at all. Educated citizens (oops, sorry, I meant "consumers") are the last thing they want.