States To Try Taxation Of The Net Again

kimbermatic writes "From the Denver Post comes this article that the states are ready to try and tax the internet sales once more. The poor economy is sending the 'hounds' sniffing for more money. An interesting, and alarming read if your interested in protecting online merchants from this taxation plan." 'though it's not really online sales that are the big ones people want -- it's catalog mail order sales, which are still much bigger then online sales.

Comments

Tariffs

[anonymousman77]

Why don't we just try taxing imports? Works well for the Chinese and every other country that has positive GDP growth this year.

Free traders will say that it will hurt us in the long run, but in the long run "we're all dead".

Re:Tariffs

[kin_korn_karn]

As much as I'd love to see it, we can't, because then we'd be seen as isolationist and unwilling to share our wealth with the world.

Other cultures get pissed off when the USA doesn't give them money. If we were to tax imports, then China would complain to the UN that we were using our position as the world's biggest buyer to extort extra money in the form of taxes from our trading partners.

If you think Bin Laden is pissed off, just remember - we GAVE him money. Imagine what a terrorist would think when we TAKE money from them.

Re:Tariffs

[SirSlud]

But the US needs free trade more than anybody to soften the risk of entering foreign markets. Most of the 'free trade' agreements in place (at least with Canada and Mexico) were the brainchildren of US business men in order to make it easy to get into other markets (well, really, to make it difficult for local governments to protect domestic markets - same thing) .. I'm not sure setting up tarrifs would go over well at this point.

It'd seem pretty hypocritical of the US, and it'd probably be difficult to get away with, given the amount of trade agreements in place that purpot to provide free trade with various foreign markets.

Re:Tariffs

[Daniel Dvorkin]

Yeah, but "the long run" when you're talking about the negative effects of tariffs on trade is, like, five years. Tariff wars were among the main causes of the Great Depression. I'd rather not see us go down that road again, thanks. The few countries that have success with big tariffs (e.g. China) tend to be developing countries that can sell their exports so cheap that when richer countries (e.g. the US) slap retaliatory tariffs on the poor countries' exported goods, those goods are still so cheap that the people in the richer countries will buy them. In cases where the economic situations are more nearly equal (e.g., the US and Japan) tariffs end up hurting both sides, and revenue goes down pretty fast because everyone's out of work, and bums don't pay taxes.

The other issue, of course, is that US States can't enact foreign policy. I think that there may have been a couple of times when state governments have tried to enact tariffs on foreign goods and have been shot down, though I'm not sure. And since we're talking state revenue, not federal ...

Re:Tariffs

[Anonymous Coward]

Why would you love to see import taxes? You do realize that means no more cheap TV's and other consumer electronics. Any tax on imports gets passed onto you, the consumer. Taxes on imports have little to do with generating revenue. They are more about encouraging people to buy American (which in turn increases tax revenue).

Re:Tariffs

[anonymousman77]

Bzzzt... I don't see anyone buying OUR stuff and helping us out of our recession. When they have ALL of our wealth, will it be okay then?

Re:Tariffs

[anonymousman77]

Yes, they'd still be so cheap that we'd buy them. AND give 50% as a tax to OUR government so they don't have to tax internet traffic or other things. WIN-WIN!!

Re:Tariffs

[kin_korn_karn]

I'm not defending it, I'm just stating why it happens. World politics is all about kissing the ass of people you don't want to kiss the ass of. War sucks.

Re:Tariffs

[xyzzy-ladder]

The US already does this, often indirectly. For example, we tax sugar from overseas, so Florida sugar corporations can sell their sugar for a high price (this is the reason you get high fuctose corn syrup in soda instead of the high priced sugar). The Florida sugar corporations give a kick back to the politicians who pass these subsidies in the form of campaign contributions.

Same for many agricultural products. The undisputed leader of agriculture subsidies in ADM, supermarket to the world. Europe subsidizes its agriculture industry, just like the US.

Bush just slapped tariffs on steel, tariffs on lumber from Canada, and gave cash and loan subsidies to the airlines. All the Republican administrations - Reagan, Bush I, all believed in a large central government that centralized economic power, and redistributed wealth from the middle class to the rich. So did Clinton. Free markets are like a free lunch - ain't no such thing.

When the US says other countries should open their market and lower trade barriers, they mean just that - OTHER COUNTRIES. Not the US. We play by our own set of rules.

When other countries subsidize their industries and protect their local businesses, we call that SOCIALISM. When the US subsidizes our industries and protect our local business, we call that CAPITALISM. See how it works?

Re:Tariffs

[artemis67]

In the long run, I'm dead but my heirs aren't. When my daughter is elected President in 2046, I don't want her to have to deal with the economic collapse caused by silly isolationist policies.

Logically, where does it stop? We tax their imports, they tax our exports at a higher rate. Inflation skyrockets, black markets are created, we try to force them to lower tariffs by raising ours, they raise theirs in response.

Re:Tariffs

[SirSlud]

That first line in your post is hilarious. :P No tarrifs == sharing of wealth? Laugh.

More likely it would piss off the world because multilateral free trade is how american multinationals get into foreign markets (b/c it weakens the foreign governments' ability to protect industries.) Consider all the conditions of IMF aid .. lets see, privatization, liberalized trade .. for business for all of which, for some odd reason, seems to go to american multinationals!

The US doesn't _need_ tarrifs, which is why it doesn't have any. You don't really suppose American international trade policy has anything to do with whats nice, do you? I mean, the trading policies in place are pretty much what heads of multinationals want them to be .. and they wouldn't give a flying fuck how anybody sees the US, so long as they can start selling Pillsbury to Venezualans.

So no, its not foreign countries that would be pissed if tarrifs increased. It'd be heads of US corps that would freak .. cause tarrif wars make it exeedingly difficult to gain access to foreign markets. The inevitable tarrifs that would go up in other countries as soon as the US started using them more would have the effect of making it more difficult to exploit foreign markets.

Just look at some of the prominant trade agreements in place. NAFTA was dreampt up by american corperate heads, and then pitched to Canada and Mexico through 'figure heads' inside those countries. The biggest opponants to increasing tarrifs would be growth-minded CEOs inside the US's border fearing a tarrif war with markets they're trying to expand in.

Re:Tariffs

[f97tosc]

Why don't we just try taxing imports? Works well for the Chinese and every other country that has positive GDP growth this year.

Both the US and China are members of the WTO, which makes it very difficult to put new tariffs in place. While China certainly has more trade restrictions than the US, the main reason for the trade imbalance is that the China has something to offer that the US wants (cheap, simple goods like toys and Halloween decorations) but there are few american goods that are affordable to the Chinese (this has little to do with tariffs, but rather with the fact that the average Chinese has a monthly salary that is one tenth the average American's).

The suggestion that tariffs are essential for growth and prosperity is ridiculous, the US and other of the worlds richest countries all have long-standing free-trading policies. The fact that China has higher GDP growth than the US should be attributed to the enormous opportunities that have become available during the last 20 years as the country has opened up economically. It is also much easier to have a high GDP growth if your current GDP is one tenth of the most modern countries (like the US).

Tor

Re:Tariffs

[weetabix]

It'd seem pretty hypocritical of the US, and it'd probably be difficult to get away with, given the amount of trade agreements in place that purpot to provide free trade with various foreign markets. Hypocritical? Softwood lumber, anyone?

Re:Tariffs

[Anonymous Coward]

When my daughter is elected President in 2046

Unless you're anticipating some kind of constitutional amendment, she will have to be elected in 2044 or 2048.

~~~

Re:Tariffs

[SirSlud]

Yep, that was somewhat hypocritical.

But only somewhat, as I realize Canada may have been selling the lumber at a loss. This wasn't a situation where the tarrifs were simply designed to protect domestic business at any cost; just to even out the disadvantage they had of losing money if they matched Canadian prices.

I guess it really comes down to whether you feel selling at a loss to gain market access is fair game under free trade? My interpretation is that if you're a true 'laissez faire' kind guy, then you have to accept other markets may try things like this and that its still no justification for imposing duties. Thats why the US sometimes comes off as hypocritical sometimes with respect to trading policies. They seem to be for free trade, so long as they are able to remain the leader in markets. When some of our own industries have all but caved to the American invasion (retail, in this case), American industries which feel the threat of international competition sometimes go running off to seek protection via duties. If that isn't shades of hypocracy, I'm not sure what is?

Re:Tariffs

[Anonymous Coward]

tariffs raise prices for both domestic and foreign products.
take this (hypothetical) example:
Honda produces a car that can retail in the US for 15,000. Ford, GM, and Chrysler can't produce a car for that cheap. Their cheapest car is 17,000.

Now the US steps in and artificially raises the price of foreign cars by a third, making the Honda 20,000. Now Ford, GM, and Chrysler can raise the prices of their cars to 19,999, and still beat out Honda.

Read up on the Tariff of Abominations in US history to see how this contributed to the Civil War (yes, there were other reasons besides slavery).

Re:Tariffs

[Vainglorious Coward]

If we were to tax imports, then China would complain to the UN that we were using our position as the world's biggest buyer to extort extra money in the form of taxes from our trading partners

What do you mean "If..."? Thanks to pork barrel policies, the US already does have extortionate import duties. The 29% duty on softwood lumber for example. The 30% duties on steel for another. In the case of softwood lumber, the issue has come up before the WTO several times in the last few years, and on each occasion the US was deemed to be in blatant violation of the rules. But the tariffs remain...

Re:Tariffs

[Stonehand]

When the Bush administration, probably under the direction of Rove, said "to hell with our free-trade stance, let's go protectionist on steel", their were very, very vocal complaints from across the Atlantic. So yes, Europe seems to mind.

Re:Tariffs

[issachar]

No, Canada wasn't selling the lumber at a loss. That wouldn't make for profitable companies in the long term, and Canadian lumber companies are profitable. (or at least they are without the duties).

But what's REALLY profitable these days is to be a Canadian manufacturer or pre-drilled studs. (that's a kind of lumber you pervs). US manufacturers have to deal with increased costs, (because they make the studs out of lumber which is more expensive in the US due to the tariffs), while Canadian manfacturers get costs reduced because the tarrifs in the US means cheaper lumber in Canada. Then they ship down to the US, and pre-drilled studs don't have a tariff on them. So US manufacturers are getting the crap kicked out of them. Just goes to show that if you meddle in the free market, you get unintended consequences.

And then there's the US protectionists on Steel...

Re:Tariffs

[SirSlud]

Part of my point was they would mind because the US has been so pro-free-trade that to have them selectively go protectionist would not be a popular move.

Yes, duties go up, industries in other markets will complain. Thats fairly natural and should happen when you impose virtually any duty on a product you're importing.

But a bigger issue which most people would base their reaction off of (ie, if they weren't the ones on the receiving end of the duty-increase) is simply the gains the US has been able to make from free-trade policy and how infuriating it would be for the US to be selectively protectionist whenever it suits its whim. That'd be the larger picture attitude that would get industries worried or frusterated even if they wern't specifically on the receiving end of a specific increase in duties.

Re:Tariffs

[Vainglorious Coward]

Canada may have been selling the lumber at a loss

Not true. Canada was most certainly not selling at a loss; selling at a price that would represent a loss for US producers perhaps, but then, that's what this all boils down to : some regions produce certain goods and services more cheaply than others. Do we want free trade or fair trade?

Re:Tariffs

[TheOneEyedMan]

Actually, the USA lacks one tax common to almost every other country: taxes on exports.
Article I, section 9 of the US Constitution says
No tax or duty shall be laid on articles exported from any state.
But that has nothing to do with ability to afford the lack of tariff. When that was written the USA was a poor colony with almost no industry. We did have cheap labor and lots of commodities to export.

Re:Tariffs

[Anonymous Coward]

And have a sex change

Re:Tariffs

[nelsonal]

Sugar is one of the worst barriers in the states, although it is a quota rather than a tax. I think there is or was a pretty steep duty on V-8 engines, it might have been lifted or reduced, but that is why there were never many big SUVs from Japan. The best reason to avoid tarrifs is that they are a pretty inefficiant way to raise revenues, they create large imbalances in the price of goods for a relatively small amount of tax revenues. They happen because the benefits flow to a relatively small group of producers, and the costs are passed on to a large group of consumers. For example in the sugar quota, which is older so there are more studies about the costs and benefits, I believe that it only costs each person in the country a few dollars each. However, millions go to each sugar beet or cane farmer, so they are more motivated to work to keep the quota than the few people who are willing to organize just to save a few dollars a year.

Re:Tariffs

[Greedo]

The US already does this, often indirectly. For example, we tax sugar from overseas, so Florida sugar corporations can sell their sugar for a high price (this is the reason you get high fuctose corn syrup in soda instead of the high priced sugar).

Things like this are also the reason why you only get mandarin oranges in Canada at certain times of the year. They grow year round, of course, in different countries, but the US wants us all to buy Florida or Californian oranges, so they make it hard-to-impossible to get them at other times.

At least, that's the gist of something someone told me recently.

Re:Tariffs

[glesga_kiss]

Other cultures get pissed off when the USA doesn't give them money.

A troll moderated to 4, who'd have thought it?

Which cultures have you been "giving" money to then? Go on, name them...

If we were to tax imports

You already are. Just because you aren't aware of it, that doesn't mean you aren't doing it already. These kind of taxes, levies, restrictions or whatever they get called this week are a large part of international trade and diplomacy. Bought any Cuban cigars lately?

America is not alone in this, a lot of countries have done it many times over the years. And wars have been fought over it, e.g. the US civil war.

Re:Tariffs

[kiatoa]

Simple, don't tax the labour portion of imports but DO tax the raw material portions of imports. For example, applied to oil, follow these steps

1. Tax oil imports.

-- This pushes oil consumption down

-- Which (over time) forces exporting countries to drop prices to maintain revenue

2. Counter the increased price of oil by lowering income taxes proportional to amount of tax on imported oil. I.e. consumers are overall no worse off. Personally I'd like to see an annual equally distributed per-taxpayer payout.

3. Repeat for other imports dominated by raw materials as part of their value: diamonds, wood products (perhaps), food (land is the raw material) etc.

Ironically taxing oil imports will yield a net *lower* effective price on oil. This effect would be most powerful if the oil importing countries of the world got together and agreed on a tax rate they should each apply. Unfortunately there is an implict assumption in the above scenario - the government must give the oil taxes back to the people either as direct payments or in decreased income taxes or the effect on the economy will be quite harmful. Of course in reality the Republicrats will buy more pork...

Unintended consequences would include more efficient use of oil resources and perhaps a transient disruption of the economy.

By applying the tax to the raw materials you don't do harm to the people who do all the work in producing the goods. See http://www.henrygeorge.org for a different perspective on this idea (they disagree with me BTW).

What other unintended consequences would there be?

Re:Tariffs

[b0bby]

2. Counter the increased price of oil by lowering income taxes proportional to amount of tax on imported oil. I.e. consumers are overall no worse off.
Maybe overall consumers are no worse off, but this would be a very regressive form of taxation, since poor people spend a greater percentage of their income on basics like oil.

Re:Tariffs

[kiatoa]

Doesn't apply - note I said that for this to work the government MUST give the money gathered directly back to the taxpayers. However your point is important because if the government does not give the money back to the people then sure enough lower income folks would be hard hit.

So assuming that the government did follow though and pass the money back to the people in a well distributed way, everyone, including the poor, would be better off since less US dollars would be going overseas in spite of the same level of oil consumption.

...

Re:Tariffs

[sco08y]

Thats why the US sometimes comes off as hypocritical sometimes with respect to trading policies. They seem to be for free trade, so long as they are able to remain the leader in markets.

Hypocrisy isn't really the issue here. I mean, how can a whole country be "for" or "against" an issue? In our last election, when Gore had a When some of our own industries have all but caved to the American invasion (retail, in this case), American industries which feel the threat of international competition sometimes go running off to seek protection via duties.

The problem is that US protectionism is short-sighted. We're propping up our failing steel industries at the expense of consumers and high-tech. There are reasons why this happens: Bush has a tenuous mandate, so he wasn't about to piss the steelworkers off. That's politics.

I'm pretty comfortable with the US's overall record for free trade, but it could be a lot better.

I also brought up the hypocrisy issue because it's a bad way to think: if we're doing the wrong thing (propping up our weak industries) you should do the right thing. If your Canadian retail is dying, that's because it's uncompetitive. You should let it go and focus on something that will make money.

If you say "oh well, the Americans are being hypocrites so let's join the protectionists' club" that's just like a kid saying "well, my Dad smokes so I'm going to get emphysema (sp?!) too."

Re:Tariffs

[Hott of the World]

"This pushes oil consumption down"

Taxing oil will not push oil consumption down, it will just stop people from purchasing things beside oil, because you have to be able to get to work. Oil is a pretty inflexable resource, I'd say more than Insulin.

What do you think would happen if you taxed insulin 200%? People would be almost as mad as if you taxed Oil 10-20%.

Re:Tariffs

[kiatoa]

It might not push the consumption down in the short term but in the longer term I believe it would. Over time some people would purchase more efficient vehicles or (*gasp*!), take the bus or train or maybe even a bicycle to work. Then there is more insulation for the house, using more efficient lighting etc. And there are many other things which depend on oil and some of those have more elastic demand curves. Carpets for example. Many carpets are mostly made of oil I think and people can generally afford to wait a little longer to replace a carpet that they don't like the color of. Of course since the government gave the taxes collected back to the people, they (the taxpayers) have more money to spend...

...

Re:Tariffs

[Anonymous Coward]

1. Tax oil imports.

-- This pushes oil consumption down

2. Counter the increased price of oil by lowering income taxes proportional to amount of tax on imported oil. I.e. consumers are overall no worse off


There's a step in your reasoning that I'm not following. If the cost of oil rises X dollars and each person receives an X dollar income tax reduction/rebate what makes you think there would be any net reduction in the amount of oil consumed? Wouldn't people just take the extra money they got from reduced income tax and spend it on the now more expensive oil resulting in the same amount of oil consumed. Perhaps in the very short term there would be a drop (until the rebates started filtering back) but in the long run oil consumption would be the same.

Re:Tariffs

[Simon Garlick]

The US doesn't _need_ tarrifs, which is why it doesn't have any.

Hello, I have REALITY on Line 1, will you take the call?

Re:Tariffs

[letxa2000]

It might not push the consumption down in the short term but in the longer term I believe it would. Over time some people would purchase more efficient vehicles or (*gasp*!), take the bus or train or maybe even a bicycle to work.

Don't count on it. Instituting a steep tax on gas probably would generate some massive turnover in Congress due to pissed-off voters, though, so it might not be entirely bad. You'd get new legislators which would give the people what they want: cheap gas.

The idea of using government to tax activities or products that certain people think are undesirable is wrong, period. It's a free country, or at least it was. If gas costs $1/gallon and I have enough money to burn a thousand gallons per month, that's my business. I don't need someone telling me (through taxation) that I shouldn't do that. If it's not illeal, leave me alone.

Of course since the government gave the taxes collected back to the people, they (the taxpayers) have more money to spend...

It's not clear what you're suggesting there. I will give you the benefit of the doubt and NOT assume that you are suggesting that the government taking money from us and then giving it back to us is somehow going to HELP the economy or stimulate spending? Because that'd just be silly. When you take money away from the people--be it in higher prices or higher taxes--people have less money to spend. If you take it away and give it back, people still have less money because you wasted a lot of it on the agencies that collect and distribute that money.

Re:Tariffs

[letxa2000]

Actually, the USA lacks one tax common to almost every other country: taxes on exports.

Who has taxes on exports? I've heard of export licenses (with some fee, surely), but never heard of export taxes.

That'd be counterproductive to ANY country and instituting such a tax would be silly and insane. While some people believe that taxing imports is good to try to keep your money "at home," I don't know anyone that advocates taxing your EXPORTS which just means you are selling less product abroad and, thus, limiting your cash inflows and reducing your income.

Re:Tariffs

[letxa2000]

Do we want free trade or fair trade?

Free trade IS fair trade. The problem is an entitlement attitude whereby some people believe they have some right to continue doing business as they have done business in the past, and that anyone that undercuts them is unfair. This is true of U.S. industries that are afraid of Mexico, India, or China because of low labor costs. This is true of Mexico that is afraid of the U.S. because they fear our efficiency. This is true of the RIAA because their business model is dead and they fear free music.

Fact is, everyone "knows" free trade is fair trade. At the same time, many, many people who knows this also fear this. They claim they want free trade but complain when they get it.

Free trade is inevitable.

Re:Tariffs

[Anonymous Coward]

And dye her skin white.

Re:Tariffs

[kiatoa]

I'm assuming that there are alternatives to spending the money on the oil products. For example you can use natural gas for heat or better insulate your house. You can use a bus instead of drive. Now you can keep the money and spend it on something else instead of the oil. This type of tax would shift the equilibrium point and keep US dollars at home instead of giving those dollars to people who are not even doing any work for the money.

I'm saying tax away some of the windfall profits from harvesting natural resources. Especially if those windfall profits are going overseas.

Re:Tariffs

[corey_lawson]

Mandarin oranges? Most of the cans of Mandarin oranges I see are imported from outside the US. You mean the fresh ones? Well, fresh fruit like this would generally come across the pond by ship. Give that a week. Then give the stuff another 3 or 4 days to process through the intermodal network, a day or 3 to go from fruit wholesaler to grocery store buyer and grocery store warehouses, and...wait. they're mostly gray lumps of stinky mold now. Hmm... No, the US orange growers want you to buy Navel and Valencia hybrid oranges...they rot slightly slower, or can be picked even greener, etc. The odd thing about the Florida sugar subsidies is that it is mostly aimed at trying to give the middle finger to Cuba. The US sugar industry is pretty small. So one consequence of the sugar subsidies is that you have some major candy producers shutting down candy factories in the US and moving them to Canada...

Re:Tariffs

[TheOneEyedMan]

Lots of countries do this. Notably, very poor ones with comodity exports. IF you can't seem to collect income tax why not go to your big diamond mine and collect a share of their export revenue. I agree it is horribly inefficent, but then again, so are import tarrifs.

Collection? Enforcement?

[dnoyeb]

Collecting this tax will cost more than the tax can produce itself. They at least need to settle the New World Order and implement the 1 World Government under "W" first. After which implementing this will be much simpler...

Remember, you are supposed to be paying state tax on all of your catalog orders anyway. So this will not be a new law, just a new enforcement technique...

Re:Collection? Enforcement?

[namespan]

While the jab at dubya is something of a troll (though you should read this and this before you dismiss the sentiment outright), the part about collecting the tax is fairly insightful. Exactly how do you set up a system for tracking this sort of thing? Or do they just plan to dump the burden on merchants everywhere, and sock it to them if they don't comply?

The jurisdiction issues also make my head spin. I can't see any reason why, if I sell from California, Conneticut has any business regulating how I do business....

Re:Collection? Enforcement?

[Fat Casper]

Remember, you are supposed to be paying state tax on all of your catalog orders anyway. So this will not be a new law, just a new enforcement technique...

Actually, I live in New Hampshire.

Wow, sucks to be an online merchant

[ShawnDoc]

Can you imagine having to try to figure out what sales tax to charge and who to forward the payment on to if local/state governments are allowed to tax online sales? Not only do you have to contend with different rates for different localities, but you have to mess with different exemptions and ways of classifying products for tax purposes. This will kill the small online merchants in a heartbeat.

Re:Wow, sucks to be an online merchant

[kin_korn_karn]

I'm in the midst of such a project for my employer. It's going to be nasty.

Right now we just plan to charge sales tax on customers in jurisdictions where we have nexus. That means only a handful of states. Iteration 2 of the project is to do this for international transactions.

Right now we're just a service provider,not a vendor of 'hard goods', so our only product class is subscriptions to our service, but it's still going to be a bitch because of all the shoehorning we have to do of the tax calculations into our software.

Re:Wow, sucks to be an online merchant

[gorillasoft]

Can you imagine having to try to figure out what sales tax to charge and who to forward the payment on to if local/state governments are allowed to tax online sales? Not only do you have to contend with different rates for different localities, but you have to mess with different exemptions and ways of classifying products for tax purposes. This will kill the small online merchants in a heartbeat.

The Streamlined Sales Tax Project, currently underway with leaders from half of the states, would set a standard rate for all Internet sales of goods, with the possibility of a second rate for foods. This would eliminate the problem of differing rates based on localities, as the states would agree to accept the same rate.

More information about the SSTP can be found here.

Re:Wow, sucks to be an online merchant

[DEBEDb]

There are companies that specialize on
making products to facilitate just that,
like TaxWare.

C'mon

[jzs9783]

What's next - taxing garage sales?

Re:C'mon

[Masami Eiri]

Hey, don't joke about that. My hometown is trying to pass a law that says you have to pay $15 or something to hold a yard/garage sale, and can only have a maximum of 2 per year.

Re:C'mon

[dughat]

In Massachusetts you legally have to charge sales tax at a garage sale (and give the money to the state). I've never heard of anyone doing so, but if we vote to eliminate the income tax next week, they might just start trying to collect :-)

Re:C'mon

[tester13]

Actually, I think the legally you are supposed to collect state tax (at least in my state) on garage sales. Of course this goes unenforced due to the scale, but the legal obligation exists.

Re:C'mon

[VivianC]

Don't laugh. My old house was in Des Plaines Illinois. If you wanted to have a garage sale, it was a $15 permit and only good for three consecutive days. Only two permits allowed per address, per year. And the local cops did check.

Re:C'mon

[DalTech]

Contract with the city/county to sell garage sale permits online. City/county gets fee for permit and gets the tax from the sale! What a scam!

Re:C'mon

[Anonymous Coward]

How much is typically taken annually? In the UK at least, HM Customs and Excise are very interested in traders taking more than GBP 55 000 annually (turnover, *not* profit or income). However, in such a case, a registered trader may be able to deduct as input tax the VAT on anything bought mainly for the sale... (If items are sold at the zero rate, such as *valid* stamps, certain food items (the rules are complex), non-fur clothing or footwear for *young* children, and books and similar printed matter (but not stationary), then claiming the output tax can be an advantage.)

Please see www.hmce.gov.uk for full details. Traders are reminded that if they fail to register when required, or to pay VAT when due, can render them liable to severe penalties and surcharges, and in some cases imprisonment.

The upshot of this is that it seems that persons holding informal sales of second-hand goods are under the same laws as any other business, but persons doing this on only a small scale may not necessarily have to submit periodic VAT returns.

Re:C'mon

[Anonymous Coward]

I attended VeloSwap on Saturday, a huge swap meet/flea market for bicycle stuff. I have been told that individuals who sell stuff there have to pay the City of Denver sales tax for everything they sell. This apparently applies to individuals as well as businesses, so it IS like taxing garage sales!.

Re:C'mon

[Reziac]

IIRC, Calif. law says something like if your sale of used goods (including the total proceeds of a garage sale) makes more than $500, you're supposed to collect sales tax and send it in to the tax board (how you're supposed to know in advance how much money a garage sale will make escapes me) AND pay state income tax. It's rather convoluted, and everyone ignores it.

Great idea: Make things harder for online bidness

[Skyshadow]

Personally, I shop where ever the price is lowest -- that includes taxes and shipping.

This means the only time I buy at Fry's is when I either need it *fast* (which happens) or when it's so little it's not worth ordering (which also happens). I mean, the CA taxes on anything in the $50+ range makes it worthwhile to always buy online and pay shipping.

This, on the other hand, could change all that, couldn't it? I think this will just drive more people away from online business, sink a sector of the economy and drive prices up for the consumer (which means they'll probably spend less, which is a Bad Thing, especially when you're in a recession).

But hey -- if that happens, I'll start selling motherboards on the street in SF right next to the guy selling the fake Rolexes.

There is no reason...

[frank_adrian314159]

... for online (or catalog) merchants to be given special advantage over the brick and mortar kind. If you hate taxes, you can say that no business can be taxed, but as long as any are taxed, they should all be taxed equitably. If you like taxes, again, businesses should be taxed equitably. The people who quote Heinlein whenever the **AA come up should also gripe about the advantage given to companies - in this case, those who are given advantageous tax exclusions.

In any case, I see taxes as one of the prices one pays for living in a civilized society, so I see no problem taxing online folk at an equitable level.

Re:There is no reason...

[MadocGwyn]

If you like taxes, again, Who LIKES taxes their a neccicary evil, like...well...taxes.

Re:There is no reason...

[King_TJ]

Right now, things are especially lopsided - because some online retailers do charge sales tax, added on to your web-based purchases.

(I often wonder if those extra "sales tax" charges are really getting turned in as sales tax, or if it's just a scheme to bump up their profit margins?)

Anyway, I see your point that there's no logical reason to treat web commerce differently than catalog/mail order commerce. But I'd like to see no taxes on either. As someone already pointed out - the cost of enforcing this type of tax is too great. M

Re:There is no reason...

[Kintanon]

Drat, I was going to just moderate in this thread, but this is too good for me to pass up.
No one is stopping brick and mortar stores from selling online. Also, when online stores sell things to people who are within their own state they charge sales tax anyways. I think that this is fair and equitable. There is no reason why my state should be trying to tax a business that is located in california for selling something to me.
Also, some states don't have sales tax, so they already have an "unfair" advantage over businesses based in places which do have sales tax.
Of course, I'm fundamentally against "general" taxation and believe that our tax forms should include an itemized list that we can select to spend our portion of the tax we paid on. That way programs that were universally dislike would disappear quickly, programs that just a few people liked could be supported somewhat, but very popular programs would get even more money. I'm also against Social Security and Medicare. Mostly because I'll never collect SocSec, and even when my wife and I were both unemployed we didn't qualify for Medicare and as a consequence have large amounts of medical bills. So I'm paying all of this money out into services I will never see a return from, and a good 40% of my tax money gets taken to fund a military industrial complex that I don't support!

Kintanon

Re:There is no reason...

[Anonymous Coward]

I can't believe it. Another moron at 5. This is not about retailers paying taxes but collecting taxes from the consumer. They are all taxed equally on their income tax. Why does the world have to be filled with idiots like you? Then again, I guess I would be out of work.

Re:There is no reason...

[ivan256]

There is no reason... ...for online (or catalog) merchants to be given special advantage over the brick and mortar kind.

There are lots of good reasons, both legal and practical.

First of all, in state catalog and internet sales are already taxed, so let's just assume we're not talking about those for this conversation.

Out of state catalogs and internet sites are involved in interstate commerce, which is explicitly the juristiction of the federal government. These sales are already taxed in almost every state as "Use Tax" instead of sales tax because of this limitation. "Use Tax" is hardly ever enforced for individuals because it costs more money to police it than the revenue increase would justify. This leads to the second point: It would be impracitcal to enforce interstate sales tax on catalog and online vendors. First the state would have no way to keep track of which vendors shipped goods into their state, or what was in the box. Secondly, the 50x increase in the number of forms the merchants would have to file would give them a disadvantage over traditional retail outlets. Lastly, the catalog vendors don't have an advantage of retail stores because there is nothing stopping traditional retailers from selling over the internet or mail-order along side of their regular business.

you can say that no business can be taxed...
.
.
.
The people who quote Heinlein whenever the **AA come up should also gripe about the advantage given to companies - in this case, those who are given advantageous tax exclusions.

Your argument here is flawed. It is the consumer that is being taxed, not the business. The advantage is given to you not the company you are purchasing from.

Re:There is no reason...

[thales]

"In any case, I see taxes as one of the prices one pays for living in a civilized society, so I see no problem taxing online folk at an equitable level."

Do you have any problem with being forced to pay personal income taxes to states that you don't live in? After all you recive the same services (none) from those states as the online merchants will recive in return for collecting the sales taxes.

Re:There is no reason...

[Dragon213]

Not meant to be a flame, please don't take what follows as such!!

I agree with you on several points, most especially about SocSec and Medicare (I will never see them either), and that a "general" tax on e-commerce and mail order would be a Bad Thing. But, I have to totally disagree that it should be optional to support the Defense Budget and similar programs paid with taxed moneys. I believe that if you made this optional, a great majority of the people (especially during the Clinton regime) would not choose to pay taxes for support of the military.
I hope I don't need to explain that without the money from taxes, the military would shrivel up and vanish. If this happened, I would be willing to bet that within a month, everyone would be required to learn a new language (German, Russian, Chinese, take your pick) because we no longer have a force to protect ourselves. I know there are many people on /. that are very anti-military, but that institution is one of America's greatest symbols, and about the only thing that protects us from a violent occupation from a diffrent country. If that went away, so would America, and any talk of tax for interstate commerce would then be moot.

Just my $.02, not meant to flame

Re:There is no reason...

[Kintanon]

First of all, that's highly unlikely. Second of all, even if it did happen, such a massive amount of the population is armed that the occupying forces would be hard pressed to do anything productive.
As for the Germans, Russians, or Chinese invading the US, none of them have the resources.
Hell, the Chinese can't even LAND more than 100,000 troops here with their combined airforce and navy. And they can't even arm that 100,000 effectively, or keep their supply lines open for that many.
The US population is armed well enough to repel most foreign armies. And I'm an advocate of increased civilian armament as well. I believe in people taking responsibility for themselves on a community level.

Kintanon

Re:There is no reason...

[Dragon213]

Again, I would agree that they named countries don't have the resources currently....but what about several months or years from now?
As far as arming the populace, I don't see anything stopping someone from going out and buying a firearm (rifle, handgun, pick your flavor) unless they're a convicted felon, in which case, I fully agree that they shouldn't be allowed to own a firearm. But that does NOT mean that an armed populace could defend the country effectivly.
In war, the 100,000 troops that China could land here would be more than enough to stomp over the entire population of the US if there was no standing military. There is a very good reason that there is a diffrence between sending soldiers to war, and sending civilians.
Despite the traning and knowledge of military leadership, it would account for exactly dick without a trained, disciplined , and motivated soldier to carry out his/her orders. A civilian that has not been in the military just wouldn't cut the muster. Also, most civilians have never been fired at or upon, and most lack the discipline and selfless courage to be a soldier. This would probably result in an unacceptable attrition rate in the American defenders because of fear and deserters.
And above all reasons there stands one alone:
Soldiers Deserve Soldiers, not armed civilians.

Out of all the people that I know, there are very, very few that I would want to go to war with, and even less that I would trust in a foxhole.

Re:There is no reason...

[leinhos]

Even better, taxes should be voluntary, like our contributions to PBS/NPR. The government should have to make a case (every year) as to why they need to spend out money in any particular way.

Before you go "whoa, that means that no one would pay any taxes and the government would stop working," let me say that I think there would be plenty of people willing to contribute if they could see the utility of thier contribution. A strong national defense benefits everyone, but how much is really needed? Would I like to contribute to my own retirement fund (I already do, assuming that I'm going to get my own money back)? How much should I send to feed hungry children? Orgainizations like the United Way make some of these choices easier for us, why can't the government?

Re:There is no reason...

[Anonymous Coward]

No one is stopping brick and mortar stores from selling online.

They do, and they're at a disadvantage. Walmart.com and bestbuy.com have to charge sales tax because they have physical presences in all states. Amazon.com doesn't, and they don't have to change sales tax. Is there any possible justification for that kind of discrepancy?

Re:There is no reason...

[b0bby]

I think you're confusing taxes on a business (which online merchants are subject to) with the obligation for that business to collect the sales tax for each state they have customers in. Mail order merchants have never had to collect this (execept for local sales) and "e-tailers" are in the same situation.

Re:There is no reason...

[geekoid]

if your state has a sales tax, and you buy from out of state and don't pay the sales tax to your state, you are commiting tax fraud.
People who live in states with a sales tax are obligated to pay sales tax on out of state merchantes to there state franchise board.

Re:There is no reason...

[Anitra]

Grr. You sound just like the old folks from my hometown who vote down the school budget every year because they think their taxes are too high. In the meantime, the schools are falling apart, and the people most affected by them are kids who aren't taken seriously by the government/community.

Don't you see how inconsistent you are? I'm sure you don't think the military is just for your benefit - then why do you feel that way about Soc. Sec. and Medicare? Sure, they don't affect you directly... but do you want to see people begging on the street because they can't afford health care and they are so sick they can't hold a job?

No, I don't think Medicare and Social Security are done well. But it would be a grave mistake to try to remove them at this point. Besides that, I've known enough people on either (for example, my grandparents) that I no longer begrudge that part of my paycheck. I know it's necessary.

Re:There is no reason...

[r55man]

Grr. You sound just like the old folks from my hometown who vote down the school budget every year because they think their taxes are too high. In the meantime, the schools are falling apart, and the people most affected by them are kids who aren't taken seriously by the government/community.

And if the parents could vote against spending money on elderly programs, then what's the problem? Everybody gets to keep their own money, and spend it on the things important to them.

Re:There is no reason...

[radicalsubversiv]

Mostly because I'll never collect SocSec, and even when my wife and I were both unemployed we didn't qualify for Medicare and as a consequence have large amounts of medical bills. So I'm paying all of this money out into services I will never see a return from, and a good 40% of my tax money gets taken to fund a military industrial complex that I don't support!

Offhand, I would guess that this is because neither you or your wife is over the age of 65. Medicare is not, nor has it ever purported to be, a program for providing health insurance to the less fortunate. It is a program for providing health care to senior citizens. (There is a separate program, Medicaid, for providing health care to the poor, but it's woefully underfunded, among other shortcomings.) Keep in mind, this entire issue could be solved with a single-payer (Canadian-style) health-care system, which would actually save money by cutting HMOs and insurances companies, and the corresponding high overhead and administrative costs, out of the health care system.

On another note, I agree with you entirely on the defense budget. If the public at large understood that Congress appropriates over one-half of its discretionary budget for the military, and that much of that is going to expensive weapons systems the Pentagon doesn't even want, they'd be outraged.

Re:There is no reason...

[corey_lawson]

US citizens well-armed? Armed with what? How come 1000 police in riot gear can deal [brutally] with 10000 civilians? Granted, a lot of the street-level storefronts and cars will take a beating, but...

Re:There is no reason...

[corey_lawson]

wahwahwah. I can also drive to Walmart or Best Buy to see what I'm getting before I buy it. And maybe pick up a few extra things I also need that aren't carried by Amazon.com. Like, if I run out of milk and forgot to order it from Peapod.com, what do I do? Uh, I think I'll run to the nearest grocery store and buy a couple of gallons. Beats listening to two little kids who understand at a basic level that orange juice on frootloops is not a satisfactory solution.

And how exactly does the profitability of Walmart and Best BUy compare to Amazon.com? Disadvantage? Moral, at best.

It does not matter that most Americans are taxed in toto 40-50%.

I don't mind paying taxes. But where I live, I pay sales taxes on stuff with money that has already been taxed at a federal level approx. 35%. Some *cities* have an income tax, for crissakes, in addition to state sales and/or income taxes.

I know I don't make enough to move my jar of pennies into an overseas money market account that I debit from with a Visa card, start money-losing businesses to offset capital gains made in other ventures (and thus have net 0 tax), etc.

Death by 1000 paper cuts from tax forms.

Re:There is no reason...

[Dragon213]

who vote down the school budget every year because they think their taxes are too high.

So cut the budget for stupid projects (like Oklahoma's latest: the dome covering a very beautiful stained glass ceiling) and put it into the schools. I agree fully that the public school system needs a MAJOR overhaul.

Don't you see how inconsistent you are? I'm sure you don't think the military is just for your benefit - then why do you feel that way about Soc. Sec. and Medicare? Sure, they don't affect you directly... but do you want to see people begging on the street because they can't afford health care and they are so sick they can't hold a job?

Ok, first I'm in the military, so I'm slightly biased there...I admit that. I also have no problems with people who have legitemit (sp?) claims on SS or Medicare...but there are a great number that draw on those benifits that I pay for, but will never see, and don't need them

Re:There is no reason...

[pete-classic]

You couldn't be more wrong.

First, realize that if every able bodied man (the militia) maintained a firearm we would be "unoccupyable." Imagine the kind of manpower it would take to "clear" every house in America of firearms. Take one town, and you have to worry about the surrounding towns routing you.

Second, recall that the British colonies in America had no standing army. What amounted to a bunch of guys with their squirrel guns defeated the greatest standing army of the time (and their Hessian mercenaries).

Third, don't discount the huge number of people who have had Basic Combat Training. Everyone who ever served in the US Military, to include Guardsmen and Reservists have had this training.

Finally, a few years back it was popular to mock men who trained for combat outside of the auspices of the US Armed Forces. If we ever are invaded, local militia men are your last and best hope of retaining your freedoms. I hope for you sake you have some.

-Peter

PS: You said "Out of all the people that I know, there are very, very few that I would want to go to war with, and even less that I would trust in a foxhole." While I agree with the sentiment, this is a very naive statement. Let me put it to you like this: If the war came to your doorstep, would you rather trust your neighbor in the foxhole, or would you rather learn Chinese?

-P

Re:There is no reason...

[morridx]

The U. S. Constitution prohibits the several States from imposing duties on items imported from other States.

Detrimental to e-tailors

[Amadaeus]

What politicians fail to understand is that the major draw to e-tailing is the lack of taxes. Sure, shopping online a huge convenience, but people today would still choose to drive to their local retailer and actually touch and try out a product before making a purchase, and forcing taxes on e-tailing would take away any incentive for consumers to use the services of the fledging new industry.

With huge competition with prices and selection from traditional real-life retailiers such as Walmart and Best Buy, e-tailers are already having enough trouble trying to grow their new industry. Slapping taxes and removing incentives for consumers to use online services would only impair progress. We're already seeing the effects of fees on online services and its related decrease in usage (MSN, Yahoo, Hotmail), taxes would further the disincentive campaign that seems to be propagating through the online world.

Re:Detrimental to e-tailors

[ProfessorPuke]

e-tailor? Sounds like a robot sewing your clothes, or maybe those Personal Area Networks that have cat5 and DC power running between your jacket pockets.

You could try the word "e-tailer", based on "retailer", but it's still a dumb pun.

Re:Detrimental to e-tailors

[yoha]

You are saying the e-tailers should be exempt from paying taxes because their business models fail when they have to play by the same rules as everybody else. This would be called a subsidy. Tell me why e-tailers and traditional mail order companies need subsidies.

Re:Detrimental to e-tailors

[Amadaeus]

The e-tailing industry prides itself being different than traditional retailers due to the fact that it is free of taxes and govo-economic meddling that traditional retailers are stuck with. The entire industry was built based on that fact, when the industry was established, the government failed to change or make rules dealing with taxation.

It isn't a subsidy when the government slaps you with a penalty because your industry is partially successful after a long period of time. This isn't a subsidy, it's changing the rules after the fact, and it's a poor policy at best, if not downright unethical.

Re:Detrimental to e-tailors

[NineNine]

If e-tailers can't make it on their own, so be it. There's no advantage to the community overall in having e-tailers. Actually, they're a huge disadvantage. They encourage people to keep their fat, lazy asses at home, they employ far, far fewer employees than a real store, they generally don't contribute nearly as much as "real" stores do. And, you know, there *are* still small stores out there. Not every store is a fucking Wal-Mart. I own a successful small shop, and I'm forced to compete with a bunch of yahoos drop shipping everything from car tires to baby formula from their living rooms, contributing absolutely nothing to the economy, including tax.

Re:Detrimental to e-tailors

[nebby]

That's one of the stupidest arguments I've ever heard. Saying that the e-tailer industry "prides itself" upon a lack of taxes (something out of their control) and that taxing them would be unethical since it infringes upon the foundation of their "business model" is absurd.

Face it, a lack of taxes on Internet sales comes off as a temporary "loophole" in the tax system. Having a business model based exclusively on tax laws which are likely to be modified in the near future is on par with one for selling dog food over the Internet.

I'm sure Enron "prided itself" on it's backwards bookkeeping too. Not a perfect analogy, but applicable nontheless.

Re:Detrimental to e-tailors

[stefanlasiewski]

What politicians fail to understand is that the major draw to e-tailing is the lack of taxes. Sure, shopping online a huge convenience, but people today would still choose to drive to their local retailer and actually touch and try out a product before making a purchase, and forcing taxes on e-tailing would take away any incentive for consumers to use the services of the fledging new industry.

So you're arguing that e-tailing should be tax-free (read: Subsidized) because it's a new industry? I've got news for you: There are dozens of 'new industries' out there today, and almost all of them pay State taxes.

I'm not saying that there should be new taxes, and I understand that a large part of the anti-tax argument has to do with "taxation over state lines", but let me ask you this: Why should we give tax breaks to a 'fledgling new industry' and but not 'fledgling new retail store' on Main street?

I don't care if it's a fledgling new industry. I don't care if a retail store has the "I can touch the merchandise" advantage over an internet store. The internet store doesn't have to pay the high rent on Main street, they can pay the cheaper rent of a warehouse on the edge of town, or in a poorer state. There are dozens of similar advantages and disadvantages in any industry.

If the state taxes a retail business, but does not tax the similar internet business, then it means they are subsidizing one industry over another, which is unfair.

The government should not favor one industry over the other by giving tax cuts to either industry.

Re:Detrimental to e-tailors

[tmark]

What politicians fail to understand is that the major draw to e-tailing is the lack of taxes.

No, the major draw to e-tailing is the incredible reduction in price some companies (say Amazon) can offer by virtue of their huge centralized warehouses and vast economies of scale coupled with relatively low overhead and miniscule labour and other costs relative to sales.

In Canada, where we still pay the same taxes at Amazon.ca as we would if we bought things at the local bookstore, Amazon.ca's prices are a good 30-40% LESS than they are at the bookstore and 30-40% less than the next biggest online bookseller. THAT'S why I buy my books at Amazon now, NOT because I'm saving tax (which I'm not).

Re:Detrimental to e-tailors

[Amadaeus]

Stupid? Not in the least. When the industry was established, the government had no idea it would flurish, and left it to rot and die. In a turnabout of events, the industry grew exponentially, and now the government wants to succeed off of the pioneers who have worked with a set of rules since the industry began to take off.

Rules and regulations did not materialize because the government did not see full potential of the internet, and they sat on their laurels. There's a term for this: Bandwagon hopping. There's another term for this: Leeching.

Using Enron as a parallel is irresponsible at best. What Enron did was criminal, while what e-tailers are doing are adhering to rules that were simply set to such a lax state because governments were too lazy to focus on an industry that "just wouldn't fly" 8 years ago.

Re:Detrimental to e-tailors

[elphkotm]

From the view of an e-tailer, you have a large advantage. E-tailers have to compete in that environment of "yahoos drop shipping everything from car tires to baby formula from their living rooms." You have an advantage because you have frontage. You have an advantage because you can sell things that would be completely silly to sell online. You have an advantage because you can instantly gratify people. I like to walk around a real store and feel things and look at the box. Then I like to take it to the counter where I know I can come back within 30 days if I don't like it. It's bull to say that the lack of taxation gives e-tailers an advantage.

Re:Detrimental to e-tailors

[saforrest]

It isn't leeching when the government itself provides the social infrastructure that makes it possible for these companies to make a profit.

In any case, your argument is ridiculous. Governments are perfectly able to invent and charge new taxes whenever they want to. If you don't like it, make sure they aren't elected.

There is nothing new or innovative about online retailing at all. Nothing.

Re:Detrimental to e-tailors

[Anonymous Coward]

Sounds like your problem.

If you can't compete you should go out of business, every online shop has costs as well.

You sound very bitter and don't have any real points about why online businesses should be taxed.

Your whole reasoning is it makes it harder for you to compete, well wake up, its all about the ability for companies to compete whether they are local or not.

E shops have to compete with local brick shops too, people have to pay shipping and wait for their product to arrive which results in people buying locall IF the prices are reasonable which in most cases they aren't.

Also catalog and mail order sales far exceed the orders of the Internet.

Get educated before you post.

Re:Detrimental to e-tailors

[yog]

Well, you've touched on a very good point. Communities that want to encourage local business should offer a tax break to new stores and factories until they are profitable. That's just common sense. Jobs are a lot better than sales tax. Jobs foster safe, stable communities. Jobs translate into income tax, excise tax, property tax, capital gains tax, etc. etc. Once a business is profitable, it's paying corporate income tax, property tax, licensing fees, etc. etc. It's not like anyone's getting a free ride, including e-tailers.

This whole idea of taxing e-business transactions makes no sense. E-Tailers are not comparable to retail shops, as many in this discussion have already pointed out. The only point of taxing e-businesses would be to protect stores. I'm sure the Europeans will go down this road, because they are very protective of their small stores.

However the U.S. would be better advised to let the market evolve in the most efficient manner. Maybe it will result in loss of employment in local communities; that's an unfortunate but necessary side effect of economic development. They'll somehow be employed doing something else in the future, just as the buggy whip and horse saddle makers did.

Re:Detrimental to e-tailors

[bluesnowmonkey]

So in other words, you're saying we should give the "e-tailor" industry a break, because otherwise their business model doesn't work.

Should we give the music publishers a break in order to prop up THEIR faulty business model?

Re:Detrimental to e-tailors

[stefanlasiewski]

However the U.S. would be better advised to let the market evolve in the most efficient manner.

But if you tax one group but don't tax the other group, it's not a balanced market. You're protecting the Etailers in an unfair manner.

E-Tailers are not comparable to retail shops, as many in this discussion have already pointed out.

But they are comparable. Retailers and Etailers have products/services, staff and customers, and their goal is to profit, and they need a location from which to maximize profit. The only real difference is that etailers do their business online, and don't pay sales tax.

I still haven't seen a good reason why we should favor etailers vs retailers, other then many Slashdot earn their salary from the some sort of ebusiness.

To give you some perspective: I worked for an Etailer from 2000-This Year.

Re:Detrimental to e-tailors

[Sloppy]

the major draw to e-tailing is the lack of taxes

I'm not convinced of that. The main reason for a lot of my net-shopping is selection. A 'Net store has the whole country, or maybe even the whole world, as its market, so it can offer things that a single city's market wouldn't be able to support.

The problem with driving to a local retailer is that even in a big US city, I don't think you're going to easily find a Muro - Acero y Sangre CD. But thanks to an e-tailer, mine is on the way. :-)

Re:Detrimental to e-tailors

[nomadic]

What politicians fail to understand is that the major draw to e-tailing is the lack of taxes.

Nope, the major draw to e-tailing is the low prices and convenience of ordering online.

Re:Detrimental to e-tailors

[Rob Simpson]

Huh... my reasons are completely different - I buy stuff online because it is either impossible to find it in stores in my area, or it isn't worth the hours spent looking. Medical references, anime, obscure books and movies, hard-to-find electronics (eg: Handera 330), etc...

Btw, I doubt those 30-40% lower prices are realistic...is Amazon still losing money?

Re:Detrimental to e-tailors

[corey_lawson]

...what social infrastructure are you talking about? The "e-tailer" pays local taxes wherever its business is located and on what the business locally consumes. The service providers all pay taxes based on their impacts. The people who order the stuff already pay a shitload of taxes already, on their paychecks, on any property they own, etc.

The transaction is already being taxed from a variety of places.

How come noone is arguing about how absurd sales taxes are?

Re:Detrimental to e-tailors

[corey_lawson]

I still haven't seen a good reason why we should favor etailers vs retailers, other then many Slashdot earn their salary from the some sort of ebusiness. ...then why defend sales taxes at all?

You already should be paying these taxes

[Waffle Iron]

In most states, the law says that if you order goods from out of state, then it is your responsibility to report and pay the "use tax". If you aren't doing that already, you're a common criminal.

If you order a CD from Amazon and don't pay your use tax, you're cheating your state out of more money than the artist would lose if you downloaded the CD from Napster.

Don't try to rationalize. You're all thieves. Bow your heads in shame.

(I have to make myself stop here. It's just too fun to spew out righteous indignation.)

Re:You already should be paying these taxes

[Skyshadow]

Watch out -- I hear the states are going to hire Jack Valenti to come after us.

Re:You already should be paying these taxes

[Flakeloaf]

Don't try to rationalize. You're all thieves. Bow your heads in shame.

(I have to make myself stop here. It's just too fun to spew out righteous indignation.)

Well the LEAST you could have done is leave some righteous indignation for the rest of us! When you use the words "your" and "you're" in the same sentence, and use them correctly, you rob the rest of us of a valuable opportunity here!

Re:You already should be paying these taxes

[PsychoKiller]

When you use the words "your" and "you're" in the same sentence, and use them correctly, you rob the rest of us of a valuable opportunity here!

Actually, the period indicates that it is actually two sentences. Thanks for the opportunity to correct your grammar skills.

Re:You already should be paying these taxes

[Anonymous Coward]

cheating your state out of more money than the artist would lose if you downloaded the CD from Napster.

Outstanding comment!! Love it!

Re:You already should be paying these taxes

[Anonymous Coward]

If you order a CD from Amazon and don't pay your use tax, you're cheating your state out of more money than the artist would lose if you downloaded the CD from Napster.

Feel free to kill yourself now.

Re:You already should be paying these taxes

[PhxBlue]

True enough; but you can still pick on the misplaced "your" in the submission itself!

Re:You already should be paying these taxes

[Anonymous Coward]

Ah, but what about folks like me from The Granite State, where
we don't pay any sales tax?

Should our businesses have to gear up to compute and add sales taxes
for the socialist government into which we ship our goods?
HELL NO!
There are even some places, like Florida, who tax
the postage coming in!

Maybe the problem originates with state governments that
are hell-bent on taxing anything and everything.

Maybe the voters ought to Just Say NO!

Re:You already should be paying these taxes

[Ogerman]

In most states, the law says that if you order goods from out of state, then it is your responsibility to report and pay the "use tax".

Actually, this is true.. though most people are entirely unaware of it. The only folks that really pay this 'use tax' are businesses, because they actually stand a chance of being audited. It is also rather inconvenient for the average consumer to track taxable online purchases, which is why legislators want to automate the process so there's no choice but to pay the local sales tax. Fine by me as long as they eliminate unfair taxes such as property tax. Sales tax is actually the most equitable and non-discriminatory form of taxation.

Re:You already should be paying these taxes

[Reziac]

This is libel. The poster used "you're" and "your" in two separate sentences! It's fine to pick on a sub-slashdot-quality post, but please report its form factor correctly.

(I'll put myself away now, before I fall ill from laughing :)

everything

[yoha]

every other economic transaction is taxed. there is no logical explanation why these should be exempt.

Re:everything

[Anonymous Coward]

The current state is not one of "exemption," but of convenience. There's no universal tax model for this (still) relatively new model of practising commerce. Add to that the complexities of running a large online business (HQ in California, Servers in Texas, Importing in NY, etc.) and the fact that no one can agree on how these transactions should be properly interpreted by tax agencies, and you get a nightmare situation. So what's the best thing to do? Ignore the problem for the time being.

Re:everything

[Anonymous Coward]

The parent has it right.

The problem with taxing internet sales isn't the 0.xx% that has to be added to the sales price, its the reporting requrements.

Lessee now ... 50 state Tax codes to comply with ... (that's the easy part)

Now, local taxes ... Thousands (7500 according to the article) of local tax authorities ... each with their own reporting requrements and payment schedules. ... almost mappable from zip codes, but not quite, so good luck even figuring out who's taxes should be applied to a particular sale.

This is a _big_ deal even for brick and mortar retailers who know _exactly_ where each point of sale is located, and have a finite number of such points to manage (instead of a point of sale in every tax authority in the country.).

The 0.xx% added to the sale won't put online retailers out of business, but having to deal with everyone's tax code would.

OK. Plan B. Simplify the mess. States and local jurisdictions must have the same tax rate. How does that work? Did we just outlaw local taxes? Do all local tax authorities have to have the same rate? (even if they want to tax less?) Does the state reduce its rate for localities that have high rates. (ummm.... good idea 8-) )

Watch for this push to fall apart when the states realize that the money they will get from taxing internet sales is more than offset by losses due to the fact that they can't arbitrarily change their tax rules to capture as much as possible from the folks who are physically in their state.

Plan C. (my plan) Come up with a relatively straightforward way to "place" internet retailers in particular tax jurisdictions. This would be based on location of the larger pieces of the retailer's operations, and could include multiple jurisdictions for large retailers, but would not require any retailer to deal with 7500 tax authorities.

All sales made by that retailer is taxable in the retailer's jurisdictions, not the customer's.

This would have the added advantage of delivering the tax dollars to the States and Cities that bear the greatest burdon (fire, police, etc) to support the retailer.

Watch the above plan implode when the consumer infested cities realize that they can't snarf any of the loot when one of thir vermin buys some worthless knick-knack from an internet retailer based in the heartland.

Re:everything

[Anonymous Coward]

except the difficulty and cost of enforcement. Nobody pays the "use tax".

Perhaps you should if you aspire to political office, though. Consider:
"My opponent is a scofflaw and tax cheat--he did not pay use tax on his purchase of an LL Bean cedar shaving dog bed..."

tax SPAM

[kingkade]

That's great they do virtually nothing about the DOZENS pieces if spam I recieve every day, but when it comes to putting money in their pocket...

My word...

[GMontag]

My word, when will these overbearing government goofballs learn that having LOW taxes while surrounded by HIGH tax areas drives business AND revenues up for the low tax area?

Also, don't think that if there is no visible sales tax that you are buying anything tax free. The politicians conveniently forget all of the inventory, property, business income and other tax streams that they are already getting BEFORE they jack up/create a sales tax.

A perfect example of that was Washington, DC. They exempted "not for profit" organizations and had the highest sales tax in the area. This only resulted in the few businesses that were paying taxes to loose business to Maryland and Virginia.

Tennessee is now on their way to driving every bit of retail business near it's borders into the surrounding States with their 9.5% (or is it 10%?) sales tax. That is on top of their invintory taxes, "licensing" taxes, etc.

Solution? A small group of States make it inviting for internet business to locate their warehousing, data centers, etc. there and reap the benefits of elevated employment and higher volume of money due to a lower % of taxation.

Re:My word...

[voidware]

And people ask me why I vote Libertarian.

brandon
harry browne in 2004

Re:My word...

[shaper]

Tennessee is now on their way to driving every bit of retail business near it's borders into the surrounding States with their 9.5% (or is it 10%?) sales tax. That is on top of their invintory taxes, "licensing" taxes, etc.

Even with one of the highest sales taxes in the US, the average Tennessean still has one of the lowest total tax burdens in the country. We have no state income tax, relatively moderate property and license tax in most places and federal tax is, well, the same as everybody else in the country. I'll take the higher costs at the checkout counter for a lower overall tax bill any day. And enough Tennesseans agree with me to have stopped a state income tax every time one is proposed.

Re:My word...

[Anonymous Coward]

And people ask me why I vote Libertarian.

I don't have to ask, I already know. It's because you're an idiot and enjoy throwing your vote away.

Re:My word...

[Anonymous Coward]

umm, yes. It's a pity you can't see beyond a two party system.

Re:My word...

[GMontag]

The point was, if the sales tax were lower revenue would flow into the State rather than out of it.

BTW, I am an "expatriot" Tennesseean. Tennessee may not get much in the way of fuel taxes from me, but they sure as heck get the revenue from my vehicle regestration and driver's license renewal. That is one area where Tennessee makes a few extra bucks, people in high vehicle tax areas register in TN if possibel and TN gets the revenue.

Also, I always love seeing the annual "income tax riot" in Nashville whenever those dopes try to impose one.

Yes, the citizens of TN have a lower total tax burden than many, but it could be even lower with the help of the surrounding neighbors.

Re:My word...

[extra88]

Is it any surprise that there's a high sales tax and no income tax in one of the least educated states in the country? Sales taxes are regressive, a greater percentage of poor people's income goes to such taxes than rich people. There are a lot more poor people than rich people so someone is doing a good job of making them think that the state tax system is "fair."

Because you're reading this site, odds are you're better off than most and should be paying proportionally more than most.

Re:My word...

[Anonymous Coward]

Harry won't be running in 2004, probrably. Perhaps Carla Howell should run instead. She got almost as many votes in her Senate (MA, of all places!) run as Harry got for prez.

Re:My word...

[cyb3r0ptx]

Nah, it's because he wants to open the borders and turn the US into a third-world cesspool.

Re:My word...

[Anonymous Coward]

To put this in some kind of perspective:

In Sweden (Currently part of the EU, soon to be the United States of Europe if the EU "future" comitte has its way) the local income tax STARTS at 33%, on top of that federal tax (~7 % for me) of which part gets sent to EU centrally and distributed mainly to farmers in France and Spain/Italy/Portugal except for the cut to the EU politicians who have exemption from all income taxes)

Sales tax is generally 25% but 12-15% for food and 6% for books. There are also various kind of special (point) taxes on alcohol, tobacco, fuel (gasoline) electricity (more coming) and stuff like that. When there is a point tax you often pay sales tax ON the point tax as well.

What do we get? Well Medicare that gives you money but not always much in the way of treatment. A somewhat up to date but understaffed defense and oodles of politicos and civil cervants that engages in turf protection.

Re:My word...

[Azghoul]

Keep your weird morals regarding taxation out of my wallet.

Sales tax is NOT regressive. Do you actually think rich people don't buy things? Do you have any idea how much sales tax there is on a yacht?

Do you think somehow that necessities are taxed with a sales tax? Food, etc? Don't you think that places with higher sales tax and no income tax would be smart enough to make sure that the poor aren't hammered by it?

Ah, still in college I see. That explains a lot.

Re:My word...

[dustman]

My word, when will these overbearing government goofballs learn that having LOW taxes while surrounded by HIGH tax areas drives business AND revenues up for the low tax area?

Exactly. Here in New Hampshire, we have the highest alcohol purchase per capita of any of the states (and it's about twice as high as the next runner-up). This is because alcohol is really cheap here, and people drive over the border from the neighboring states to buy it.

Actually, New Hampshire's "taxes" on alcohol are "very high" (NH in fact makes more money per bottle than other states), but hard licquor is a state-owned monopoly, so we're still cheaper than everyplace else.

Also, NH has no sales tax, so we get lots of people driving in from that, too.

NH is a great example, in my opinion, of two concepts: The lower taxes (eq prices) thing you mentioned which attracts out of state commerce, and the concept of "state monopoly on vice" being very profitable.

I am not a smoker, and I am continually surprised at how expensive the habit is... I can only imagine how much the state would make if it controlled tobacco sales this way (especially, with tobacco being cheaper overall just like alcohol).

Re:My word...

[j-beda]

While it is possible to design sales tax systems that are more "progressive" and it is possible to design income tax systems that are more "regressive", in most (all?) of the standard implementations of those systems, the sales taxes hit the poorer people harder than the income taxes. If you are spending pretty much everythign that you earn on the necessities of life, having a sales tax rate of 7% is pretty much equivalent to having an income tax rate of 7% for you. I am not aware of any state that has an income tax rate this high for low income earners (or for almost any earners for that matter according to http://www.homefair.com/homefair/readart.html?art= ataxes). Interestingly, Tennessee does seem to tax investment income at 6%.

In any case, since sales taxes are the same for every purchaser, and the poorer sections of the population must spend a larger fraction of their money than the richer sections of the population, sales taxes typically hurt the poor to a greater extent than the rich, when compared to an income tax. Yes the taxes on a yatch can be a lot of money, but presumably that is less of a necessity than the items being taxed that the poor need to buy.

Of course whether or not you favour one system over the other would be influenced in how fair you feel it is to tax different people different amounts of money and how fair you feel it is to tax people different rates.

Re:My word...

[shaper]

The point was, if the sales tax were lower revenue would flow into the State rather than out of it.

Got your point, I was just trying to add some context for those who might not know. Also, I was kind of making a sideways point that one might prefer decreased overall taxes to increased state revenues.

Re:My word...

[shaper]

Is it any surprise that there's a high sales tax and no income tax in one of the least educated states [vanderbilt.edu] in the country? Sales taxes are regressive, a greater percentage of poor people's income goes to such taxes than rich people.

I was just trying to add some context to the isolated statistic about Tennessee state sales tax. I was not intending to argue tax "morality". Your point diverges into tax purposes, e.g. necessary services versus wealth redistribution. I didn't intend to get into that argument here.

Actually, I thought the comment about Tennessee to be particularly topical precisely because any hint of a state income tax has been so strongly opposed in the state. Without an income tax, the state of Tennessee will probably be among those most interested in taxing on-line transactions. Also, as with most human issues, the question and answer(s) are a lot more complicated than we like and they vary a lot, even from state to state.

Re:My word...

[extra88]

You don't know what a regressive tax is. Thanks to j-beda for briefly explaining it. (you can often count on TidBITS regulars for reasonable explanations). That knowledge makes your post moot, except the jabs about "weird morals" and your assumptions about college students.

I'm long past being an undergrad. You might have noticed that people *work* at universities too. Well, some of us use email accounts at work.

Re:My word...

[Anonymous Coward]

Do you think somehow that necessities are taxed with a sales tax? Food, etc?

Yes. Just because they may not be where you live doesn't mean it is that way everywhere else. I've lived in quite a few states, and more often than not, food is taxed.

Re:My word...

[Anonymous Coward]

Actually, I'd like to ask you why you have an aversion to the shift key.

Read the Constitution

[User 956]

From the article: Twenty-nine states will vote on a tax proposal next month that could be pivotal in their effort to tax all online sales.

Section 8 of the Constitution: Section 8. The Congress shall have power to lay and collect taxes, duties, imposts and excises ... To regulate commerce with foreign nations, and among the several states

But then, who cares about the constitution? Certainly not the United States.

Re:Read the Constitution

[aratas]

Quoting from a source (I forget exactly):

You can get around the Constitution if you place the word "Schmonstitution" right after it.

Re:Read the Constitution

[Anonymous Coward]

I believe that it was the Daily Show

Re:Read the Constitution

[User 956]

If passed, it would become effective after at least 10 states meet the provisions of the agreement, which include requiring states and its local jurisdictions to have the same tax rate. ...

Note, it says "it would become effective after at least 10 states meet the provisions of the agreement", not "it would become effective after Congress drafts and passes an appropriate measure approving the proposal". They're still circumventing Congress on the issue. The fact that they may or may not go to Congress after the law is already in effect (and generating tax revenue) is moot, since they'll already have what they want; they just don't want to be seen as trying to bypass the checks and balances in the Constitution (which is what they are doing).

So, as I was saying, who cares about the Constitution? Certainly not the United States.

While I don't like being taxed, fair's fair

[PhysicsGenius]

The people who are ordering stuff over the Internet and from J Crew/LL Bean are the richest 10% of the country[1]. It is only fair that we contribute our share towards running it and take some of the crushing burden off of the WalMart-shopping, non-SUV-driving, non-alternative-remedy-using hoi polloi.

[1]Wearings jeans and a free tshirt, avoiding showers and eating macaroni and cheese all the time doesn't make you poor. It makes you trendy.

Re:While I don't like being taxed, fair's fair

[Anonymous Coward]

The people who are ordering stuff over the Internet and from J Crew/LL Bean are the richest 10% of the country[1]

wow, i've ordered stuff online plenty of times. i wear jeans and free tshirts, but i do shower and don't eat macaroni and cheese that often. so, either, i am one of those rich trendy people i loathe so much, or i actually AM a poor grad student. sure, i'm not in the lowest tax bracket. but i highly doubt that i am anywhere NEAR the top 10%, either. of course, as an internet buyer, i also reserve my right to shop at walmart, not drive an SUV, and not use alternative remedies (though, i guess it depends on what kind of substances that includes...).

of course, whether i am what you'd call trendy or not, i still take offence that internet buyers and j crew jackoffs are somehow considered one and the same, but completely different from walmart buyers. :)

point is, people will shop where they can find something cheaper. i shop at walmart for games because it is cheaper than sam goody's (where i buy cds, because it is not censored like walmart). i shop at walmart for groceries and beer because it is generally cheaper than kroger's. and i shop on the internet for computer parts because it is cheaper than special-ordering items at local computer shops, even with shipping and handling.

Re:While I don't like being taxed, fair's fair

[tps12]

Just a correction on your Greek. That should read, "It is only fair that we contribute our share towards running it and take some of the crushing burden off of hoi WalMart-shopping, non-SUV-driving, non-alternative-remedy-using polloi."

Read the article...

[unicorn]

I do so enjoy it, when people comment without reading the articles first.

It QUTIE clearly says, that in order to get on board with this plan, states have to harmonize their sales tax regimes. So that the state, and local taxes are the same.

Re:Read the article...

[DaveAtFraud]

I do so enjoy it, when people comment without reading the articles first.

But that's the slashdot way!

It QUTIE clearly says, that in order to get on board with this plan, states have to harmonize their sales tax regimes. So that the state, and local taxes are the same.

That's about as likely as slashdot readers reading the article. You're talking about something that comes between politicians and money. That's like coming between a momma bear and her cub only the bear doesn't pretend that you like what she does to you because its "for you're own good."

Re:Read the article...

[YrWrstNtmr]

to get on board with this plan, states have to harmonize their sales tax regimes. So that the state, and local taxes are the same.

Good as a concept, VERY difficult in pratice.

Different states and localities tax different things and exempt others. Some places, food is not taxed. Some, clothing. Some places only certain types of food. Some places have no tax.

Let us take a hypothetical:
I live in State X that does not tax clothing. The etailer I wish to buy from is also located in that state. So now I have to pay not only shipping for the one piece (far more than the local store pays for bulk shipping), but additionally the country-wide Internet tax on that clothing. The balance has just moved from one side to the other. The local retailer I might visit to buy that same thing does not add on the tax. Or..it might even be the same company. Tax via the web, no tax in person.

hmmmm....

Re:Read the article...

[liamisthebest]

oh, beat it

Re:Read the article...

[Ashyukun]

It QUTIE clearly says, that in order to get on board with this plan, states have to harmonize their sales tax regimes. So that the state, and local taxes are the same.

Actually, I think the implied problem wasn't that all the taxes were not the same percent- it's that you would have to keep track of and distribute the collected taxes to X number of states (29, at least, by the sound of it- yes, I read the article). And keep up on which states jump onto the bandwagon as time goes by. I'm sure the tax preparation companies and vendors of financial and tax software are shorting out their keyboards drooling over the idea of this.

Re:Read the article...

[ShawnDoc]

Hey, its hard to be a karma whore if you actually read the linked article.

Re:Read the article...

[corey_lawson]

...as are the companies that have already developed the systems and software to deal with this (Wal-Mart, Target), so it would be a competitive advantage to do this compared to a company (amazon.com) that probably does not have this.

Everything I do with a computer is already taxed (the telephone line is already taxed, the electricity is taxed, all for the impact of those facilities on the State. If they were smart, they would quietly increase those taxes, instead of trying to make a big noise about "internet taxes".

i got an idea

[SquierStrat]

I know this is a long shot, but instead of raising taxes, how about we cut wasteful spending such tattoo removal programs in san jose, and then lower taxes so people can spend more of the money they earned. And how about we legalize drugs and tax the hell out of them. And how about ditching the income and going to a sales tax on non-essential goods and services so that people can choose when they will and when they won't pay a tax.

Man, in a perfect world...

Re:i got an idea

[tweek]

You forgot the ultimate in stupidity. High taxes on tobacco to discourage use whislt subsidising tobacco farmers to grow tobacco!

My brain reels ever time I think about it.

Re:i got an idea

[kalimar]

And how about ditching the income and going to a sales tax on non-essential goods and services so that people can choose when they will and when they won't pay a tax.

Please define 'non-essential' goods.
Do you mean a computer or cell phone? To me, those are essential. I can't do my job without them.
Do you mean a car? Sure, I might be able to do without a car. It would be hard, but I think I could do it. There's enough public transportation where I live that it might be possible.
Do you mean cable tv? To be honest, I'm not sure I can even get tv without it being cable.

Maybe it would be easier to define what is universally essential.
There's water, electricity, gas, and telephone service. That's about all that is 'essential' for everyone. Somehow, I don't think that taxing everything else would fly. It would be interesting to see how many people would go for it though.

Anyone know how much money Americans spend on things other than water, electricity, gas, and telephone service? (Would you count rent/mortgage as non-essential?) Work it back from there. Unless sales tax on these non-essential goods and services (goods are one-time charges, services recur) is close to the current income tax, the government would probably end up losing money. I know that I don't even spend as much money as the government takes from me in income tax unless you count rent (and even then I barely outspend the income tax). It seems like a losing proposition to me.

Please tell me if I'm missing something.

Re:i got an idea

[SquierStrat]

Essential goods and services:
Things you need to properly live. Such as food, medical services, clothes and shelter.

Now, you say that government would end up losing income. Well, you're forgetting something:
you'd have more money to spend. That means that you would probably end up spending that money you didn't pay in income taxes on other things. Even if you save it, as long as you don't shove your money under a mattress, that money is not stagnant. In a bank it is being loaned for home purchases, starting new businesses, other investments. In stocks it is being used for various business issues. Then stocks, those are goods are they not? Taxed then, are they not?

Then there is the issue of ill-gotten money, such as money from illegal gambling, black market items, or any mob money. Those monies are not being taxed right now! With a sales tax they would be. Just because you might pay less in taxes under such a system, doesn't mean everyone would. I wouldn't, I'd pay alot more in taxes. My parents would pay alot more. Some of my friends however would pay alot less.

Re:i got an idea

[UncleFluffy]

Please define 'non-essential' goods.

Anything that you could go without and not die.

Agreed, with Reservations

[waldoj]

After years of disagreement, I no longer believe that Internet sales should be free of taxation as a class unto itself. I argued in the mid- to late-90s that the shipping cost was a barrier to the then dozen-or-so e-commerce sites, and we needed to not throw up more barriers to prevent the economic success of the Internet. The Internet has now had that development time, and I am no longer convinced that an exemption is necessary.

My remaining concerns are not sufficient to convince me that Internet taxation should not occur, but they are significant. The biggest one is the logistical nightmare of paying sales taxes to 50 different states, should that be the nature of the changed laws. Though the software end of calculating the fees surely wouldn't be difficult, the average mom-and-pop .com (and there are lots of them) would likely find having to file in so many different manners at different deadlines on different paperwork to be a significant problem.

JM2C.

-Waldo Jaquith

Re:Agreed, with Reservations

[Anonymous Coward]

You're wrong. There is a big difference to me that when I buy something online, I have to pay shipping which is profit for UPS or FedEX, rather than sales tax, which is profit for no one. Governments waste our money. It is totally wasted, and does not contribute to the economy, only to the hand gripping our throats.

And NO, I don't report use taxes--the whole concept is astoundingly absurd and clearly unconstitutional under the alrady cited Interstate Commerce Clause.

If local businesses are crying unfair competition, then the solution is to eliminate sales taxes, not create more regulation for online commerce. Sheesh!

Re:Agreed, with Reservations

[RalphSlate]

To add to that, wait until the audits happen. Imagine a mom-and-pop being a candidate for an audit from all 50 states. I worked at a retailer who served 6-7 states, and we had sales tax auditors in our offices from each state at least once every 3-4 years.

They would say things like "historically, a store like yours has a breakdown of 80% taxable and 20% nontaxable goods. Your sales show that you are only submitting sales tax on 78% of your goods, so that means that you have to pay us sales tax on 2% of the goods that you sold in our state since the last time we audited you (usually 3-4 years ago).

It wasn't pretty!

Re:Agreed, with Reservations

[geekoid]

you're arguement is based on ignorance, I should say stupidity since you didn't bother to reasearch, but I'll let it go with ignorance.

If your state has a sales tax, you have always been resposible for paying taxes on out of stata purchases to your franchise board. under Use tax.

No new laws should be needed

[ProfessorPuke]

The governments shouldn't need to create any new laws to tax internet sales, because they should already do so.

Performing an age old activity like sending packages through the mail in exchange for money transmitted by credit card should be equally taxable regardless of whether the customer places her order via phone, email, paper mail, http, fax, or the trusty old carrier pigeon.

We've seen it again and again- government regulators/lawmakers/busybodies get tricked into thinking that activities are somehow inherently different when computers and internet are involved. This gives us special laws to prohibit computer intrusion (we've had wire fraud statutes since 1910) and special patents for "carrying out traditional business XYZ, but over http".

I can understand the argument that to support budding e-commerce, you want to give them a temporary reprieve from some normal costs of business. But the expiration of such grace periods shouldn't be newsworthy, it should just be expected.

Its about time this happened.

Re:No new laws should be needed

[mikeboone]

We've seen it again and again- government regulators/lawmakers/busybodies get tricked into thinking that activities are somehow inherently different when computers and internet are involved.

That sounds like a good description for the software patent problem, too!

Enough

[drhairston]

Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax? Every other method of interaction in the world - from face-to-face transactions to mail order to telephone sales - is governed by state statues which tax that commerce. Is the Internet exempt simply because it is 'too cool' or 'over the head of stuffy old lawmakers'?

Perhaps taxation laws are merely over the heads of overexcited teenagers.

Re:Enough

[damiangerous]

Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax?

Well, putting aside for the moment your painful sentence structure of "the Internet" paying taxes or being taxed, let's get to the root of what you mean. Sales tax on items purchased over the Internet are not exempt from sales tax. This is a myth. Look at your state income tax return and you are almost sure to see a line for "use tax." In this line you are instructed to enter the value of merchandise you own/were given/won/etc that you have not yet paid tax on. Now for the second part, why people believe purchases made over the internet are "tax exempt." When you make a purchase at a retail store, the merchant is required by law to withhold sales tax on your behalf and submit it to the local jurisdictions. There is only a single juridsdiction (or group of jurisdictions) that remains the same with every transaction. It would be burdensome to expect a mail order operation, doing business across the country, to be familiar with the hundreds, if not thousands, of local tax jurisdictions and which apply to any given transaction. There is also the small matter of other jurisdictions not having the authority (to require tax collection) over a business outside their jurisdiction. Therefore the individual taxpayer is responsible paying any taxes they incur on a purchase made through the mail.

Is the Internet exempt simply because it is 'too cool' or 'over the head of stuffy old lawmakers'? Perhaps taxation laws are merely over the heads of overexcited teenagers.

Or perhaps you're guilty of not understanding the issues? I certainly hope you impart better research skills to your students at CCBC. With your attitude towards "overexcited teenagers" I would doubt it though.

Re:Enough

[taustin]

Internet sales are mail order. It's that simple. Mail order and how it interacts with salex tax law, has been well established for over a century. No changes are needed.

This is simply a new way to get government hands in our pockets.

Re:Enough

[dpille]

Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax? How about that Internet sales harness an efficiency that outweighs the tax-collection benefit? I'm imagining, say, comparing my online purchases delivered in FedEx low emission vehicles from a single dimly-lit warehouse in a temperate climate to hopping in my 10 mpg SUV, driving to the well-lit and air-conditioned store, and making a purchase that is taxed to pay for, among other things, a clean air regulatory system and environmental remediation. You could come up with a ton of possibilities: putting keyboard repetitive stress injuries on purchasers instead of retail employees that collect from state workers comp funds, shifting income growth from lower-tax-bracket retail employees to higher-bracket shipping employees, lower retail construction demand leading to cheaper road construction contracts, whatever else. Just because it 'makes sense' to apply sales tax to internet purchases doesn't mean it'd be good for everyone or even the government.

Re:Enough

[Anonymous Coward]

Please mod up the first intelligent post I have read on Slashdot today. There are so few of them, let's try and reward people for making them.

Re:Enough

[Rupert]

You have answered your own question. Purchases made in a state where the seller has no business presence are not taxed. Internet, mail order, walking into a department store and having them mail it out of state are all taxed the same.

The internet is over the head of overexcited lawmakers, and they can't see that nothing has changed here. Never mind that B2C catalogue sales are 10 times the dollar value of all B2C ecommerce. The internet is new, and to be feared, and what they fear they either ban or tax.

Re:Enough

[Anonymous Coward]

Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax?

Internet commerce is not now and has never been exempt of tax. The only issue up for debate is where the burden of collection lies. For standard mail order and internet commerce, the burden of paying sales tax lies with the citizens of the state that collects the tax. This is the only right and natural way to do it. Why should I, a resident of state X be beholden to state Y's tax laws if I have no presence there? That makes exactly no sense.

Re:Enough

[thales]

" Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax?"

Can you put togather a real reasoned argument why you shouldn't have to pay Income Taxes to a state you don't live in? Both you and the Online Merchant aren't allowed to vote in the state you don't live in. Both you and the online merchant recieve no services from a state you don't live in.

Why should a state that I don't live in, have never visited, recieve zero services from, and have no representation in the government of, be allowed to pass a law that compells me to become an unpaid public servant (tax collector) for that state? Didn't we pass some admendment to the US Constitution that banned "invoulantary servitude" ?

Re:Enough

[buzzcutbuddha]

Well, Federally, one reason would be the Constitution says in Article 1, Section 9: "No Tax or Duty shall be laid on Articles exported from any State." which essentially means that all goods that are sold and intended for consumers in another State are not to be taxed.

FindLaw has much more on this here if you're interested.

Re:Enough

[Anonymous Coward]

But all you've done is say why it's *difficult*.

If all interstate sales taxes were to go straight to Federal coffers (and hence a single rate), to be redistributed accordingly, then what would be the problem?

Re:Enough

[Anonymous Coward]

Well, as damiangerous put forth Internet sales are not exempt they are just hard to enforce because there is no national reporting requirement. What the states are whining for is the implementation of means were a vendor in California must report all sales to citizens of the respective states to those states.

It is not taxation they seek, it is extra-jurisdictional enforcement of their existing local laws by unfunded 3rd parties. It is, in fact, an effective tax on the vendor requiring them to build and maintain an enforcement infrastructure.

damiangerous also rightly identified the tax in question as "Use Tax".

What is "Use Tax"? Well, when you run down to the store you need roads, traffic lights, police protection, etc. You rightly have to pay into the common good for those services.

But, when you mail order or buy online you are not using any of those services. And, definately are not doing so in the context of your home state. You may claim your home state is involved in the data communications or postal service, but those facilities are already taxed fully.

Although an unpopular belief in Governmental circles, taxation can only be ethically done in the name of appropriate administration. Taxes should, generally, refelect you use of of a thing.

So, sales and use taxes presently reflect your appropriate use of infrastructure you need to secure goods and services -- in person. You do not engage in the same level of use when served via mail order, and appropriate use taxes are already extracted at each step in the delivery process. UPS pays taxes for what they use, airports collect taxes, your telephone company collects all sorts of taxes, etc.

Net-Net everything you use in a mail order/Internet transaction is fully funded through taxes already being actively collected.

Laying taxes on Internet transactions is duplicate taxation on those that use such services.

No, you know what really sucks??

[NineNine]

To be a REAL retailer with inventory, rent to pay, etc. and have to compete with 12 year olds with online stores that don't have to pay sales tax. Why, exactly shouldn't online retailers be taxed like everybody else?

Re:No, you know what really sucks??

[jgerman]

Oh so you're only a REAL retailer if you have a brick and mortar set up? Bullshit. Online retailers are not like everyone else, otherwise they would be taxed the same. Your gripe appears to be that online retailers have it easier (and from context I assume you are in some way involved with a brick and mortar retail business). It's tough shit if your chosen business can't cut it as technology advances, but that's life, get used to it.

Re:No, you know what really sucks??

[Anonymous Coward]

To be a REAL retailer with inventory, rent to pay, etc. and have to compete with 12 year olds with online stores that don't have to pay sales tax. Why, exactly shouldn't online retailers be taxed like everybody else?

Well, there's a little thing called the US Constitution which specifically prohibits states taxing interstate commerce. The idea was to avoid having each state do exactly what the US as a whole does, i.e., use tarifs to implement protectionist policy. Now, I know the constitution is supposed to be a "living document" (bullshit IMHO) but there's really no way around that provision w/out changing the document.

No preference shall be given by any regulation of commerce or revenue to the ports of one state over those of another: nor shall vessels bound to, or from, one state, be obliged to enter, clear or pay duties in another

Re:No, you know what really sucks??

[RazzleFrog]

Online retailers do pay taxes. They pay income taxes. That is not the issue here, however. The issue is whether you and I should pay sales and use tax on items that we purchase from an online retailer out of our own state.

Currently the online retailer is not required to collect the tax since calculating the amount and paying to the various governments is too difficult. It is assumed that anybody purchasing an item online is paying the appropriate use tax for their state on their own.

The states instead would like to simplify the taxation process so that they can rely on online retailers to withhold sales tax.

Re:No, you know what really sucks??

[Anonymous Coward]

This coming from somebody who runs a porn website. Is Nine your age or your IQ? Somebody mod this moron troll down. He doesn't know what he is talking about and he is an obvious hypocrite.

Re:No, you know what really sucks??

[Rupert]

Online retailers *are* taxed like everyone else.

If I walk into NineNine's porn store in (say) Kalamazoo, and ask you you to ship the dildo I'm purchasing to my girlfriend in Texas*, you do not have to charge me sales tax unless you have a business presence in Texas.

* unless she's in Austin and already has 6, in which case that would be illegal

Re:No, you know what really sucks??

[YrWrstNtmr]

I hope you're competing on other battlegrounds with that 12 year old.

Service, selection, return policy, security...Things that bring a customer back. I don't think I've ever seen a cookie-cutter online store that I'd actually buy from. Far too many loose ends.

Re:No, you know what really sucks??

[NineNine]

You're absolutely right. Only idiots compete on price alone. So no, price isn't my selling point, but at the same time, even if I take the bare minimum markup, my products are automatically 6.5% more expensive than the same product bought online. Hell, people can shop here, ask me questions, look at the products, etc. then buy online for less because they don't have to pay sales tax.

Re:No, you know what really sucks??

[ivan256]

The states instead would like to simplify the taxation process so that they can rely on online retailers to withhold sales tax.

That's certainly a nice way to put it. I prefer this way:

The states instead would like to transfer the enormous costs of enforcing their use tax to online retailers, since the cost of accurately collecting use tax from individuals is typically higher than the revenue that is generated.

Re:No, you know what really sucks??

[NineNine]

"Too difficult"? A simple piece of software would do it for them. I forked over a good chunk of change on a couple of accounting packages, with part of the purpose to track the sales tax that's due the gov't. It's just a cost of doing business. With online retailers already having tremendously reduced costs by virtue of their business model, I see no reason that they can't collect and pay state sales taxes like everybody else.

Re:No, you know what really sucks??

[Anonymous Coward]

I hear you -- off topic...

nor shall vessels bound to, or from, one state, be obliged to enter, clear or pay duties in another

Why do I have to pay tolls when traveling from state to state? -- this kills me.

Re:No, you know what really sucks??

[NineNine]

I'm not bitching about their lower overhead. Rent, power, advertising, etc. is all part of running a retail business (I own my own shop). But taxes are a *huge* burden, and it's not righ that they haven't been doing their part to collect and pay sales tax. But since you say it's just because they're "set up" differently, maybe I should "set up" my corporation in Bermuda, huh?

Re:No, you know what really sucks??

[Anonymous Coward]

Well, you're not paying a tariff, you're paying to use their roads.

I guess. That's something I never thought of before.

Re:No, you know what really sucks??

[Eric Damron]

"Well, there's a little thing called the US Constitution which specifically prohibits states taxing interstate commerce."

Interesting that Washington State law requires vendors like Amazon.com to collect sales tax. I wonder if the law has ever been challenged?

Re:No, you know what really sucks??

[Eric Damron]

"Currently the online retailer is not required to collect the tax since calculating the amount and paying to the various governments is too difficult. It is assumed that anybody purchasing an item online is paying the appropriate use tax for their state on their own."

Not entirely correct. According to Washington State law, any online retailer who sells items with a destination within the State of Washington is required to charge sales tax. I don't know if it's constitutional. Maybe it isn't but has never been challenged in court.

Re:No, you know what really sucks??

[dslbrian]

Why, exactly shouldn't brick and mortar retailers be forced to charge everyone shipping and handling costs just like online retailers?

The "REAL retailer" argument is stupid. "REAL" customers weigh costs of shipping versus the convenience of a local store. Both stores have costs that the other does not. Online retailers have to subsidize shipping and handling for return items. You think the mom and pop store two blocks down the street is going to pay for me to fedex a defective item back to them?

No inventory or rent to pay??? Where exactly do you think Amazon keeps their bazzilion books stored? Under some 12yr olds bed? Perhaps you think a 12yr old assembles all of Dell's computers also, or that they have no inventory or rent to pay either...

Re:No, you know what really sucks??

[vsprintf]

To be a REAL retailer with inventory, rent to pay, etc. and have to compete with 12 year olds with online stores that don't have to pay sales tax. Why, exactly shouldn't online retailers be taxed like everybody else?

When I buy online, I also have to pay shipping. I haven't found buying online to be a money saver. I buy things online that I can't find locally. Why should I have to pay money to my state when I have to make a purchase in another state to get the product I want? If you want to sell to me, carry the stuff I'm looking for, and you won't have to worry about me buying online.

Re:No, you know what really sucks??

[buzzcutbuddha]

Hey, if you want to set up in Bermuda, by all means. I have no problem with it, and those that do haven't grasped the economic realities of capitalism.

Re:No, you know what really sucks??

[buzzcutbuddha]

Amazon.com is headquartered in Washington State, therefore it is legal for them to compel Amazon to charge sales tax for Washington residents. Beyond that, it should not be legal, no.

Re:No, you know what really sucks??

[buzzcutbuddha]

Wrong. It's not a simple matter of a package of software. Using Pennsylvania as an example, according to State Sales Tax laws, if you buy a shed, it's taxable because it can be removed from your property, but the foundation you place the shed on is not. A bathing suit is taxable, but a bowling shirt is not. If you buy thread in Pennsylvania, and intend to use it patch a hole in your shirt or trousers, the thread is non-taxable. If, however, you intend to patch a hole in your couch, that same thread becomes taxable.

The examples given here are not indicative of Pennsylvania, but are typical of all States, which is what the States are trying to remedy by streamlining State sales taxes to make them more uniform. That's all fine and good, BUT...

As stated elsewhere in this thread, the Constitution explicitly prohibits the taxing of goods that are "exported" to another State. States have tried for years to overturn, or side-step this law with little luck. The law is very clear. States may not tax on goods sold in one state to a consumer in another state.

Re:No, you know what really sucks??

[Anonymous Coward]

You pay because you receive services from the local and state government.

You receive police and fire protection and you receive other public services.

Online retailers do not receive those services in your state, why should they be forced to support services that don't benefit them?

Answer: They shouldn't. Sales tax on Internet purchases has long been something companies and business that can't compete want to implement, it is an excuse for them not being able to compete. If you don't like it open an Internet business, but you will find Internet businesses have their own equally difficult challenges to face.

Be educated before you post.

Re:No, you know what really sucks??

[Anonymous Coward]

That's an excellent point. I forgot about this. My sister visiting once bought a purse in Chicago. When she went to pay for the purse, she mentioned about how nice the store was and the sales person picked up that she was out of the area. The sales person asked where, found out it was Texas, knew that the store had no retail location in Texas. They shipped it to my sister's residence.

(It was a pretty expensive purse, if I recall and you're wondering if it was worth all the trouble.)

Re:No, you know what really sucks??

[Anonymous Coward]

Because even you are not subject to sales tax when shipping across state lines. You want a different rule applied for the same activity you are entitled to carry on (but obviously do not partake in), but don't even realize it.

As to the real retailer comment, I bet most online locations kicks your store's ass in terms of selection, price, not just tax. The last time I was in a bookstore, I got crappy service by same tired old 14 yo you were allowed to hire. If the 12 yo's have a store, damn good for them. If a 12 yo is making more money than you, that's YOUR FAULT. I don't need more regulation because you choose to carry on with a business you are unhappy with and there is NO barrier to you taking that business to the more supposed lucrative medium.

Re:No, you know what really sucks??

[Eric Damron]

You're right. I didn't realize that they were based in Seattle. Everytime I order from them the tracking information always starts from somewhere back east so I just assumed that they were out of state.

Re:No, you know what really sucks??

[Anonymous Coward]

Instead of the REAL retailers bitching about how online sales "should" be subject to sales tax, how about bitching that their sales SHOULDN'T be subject to sales tax? Works in 5 states...

IMHO, the government taking a cut from a sale of goods is bullshit.

Re:No, you know what really sucks??

[srussell]

No, what really sucks is that anybody has to pay sales taxes in the first place.

Re:No, you know what really sucks??

[RazzleFrog]

And how many states have you submitted tax payments to? Most B&M's just collect sales tax from people regardless of what state they are from (for small dollar items at least). That sales tax then goes to the state that the store is located in.

Are you telling me that when you charge a customer you take his zip code, determine the correct use tax for his state and then pay that tax to his state on his behalf? Big ticket stores do this but usually for only a few states that they have customers from. For example, when I bought my dining room table they charged me NY tax even though they were in CT.

Now imagine an online retailer who has to deal with 50 states with 50 different tax rates, exemptions, etc. This is why they were exempt up to this point. If the states want to get together and come up with a common law and a central clearinghouse for taxes then I think the online retailers, as well as catalog retailers, should definitely collect sales tax.

Re:No, you know what really sucks??

[RazzleFrog]

But the state has always passed that cost onto retailers. It is a lot easier to monitor and occasionally audit thousands of retailers versus millions of consumers. I don't think this is anything "evil" on the parts of the states. If anything I much prefer retailers having to make the effort than having to pay higher taxes so that the state can better enforce it.

Re:No, you know what really sucks??

[Anonymous Coward]

Hell, people can shop here, ask me questions, look at the products, etc. then buy online for less because they don't have to pay sales tax.

Well unless they are getting shipping or spending $50 or more then it wouldn't make much sense for them to do that. I think a lot less people shop online for tax breaks then people think. There is also convenience, variety and more detailed product information (including customer reviews on some websites).

Re:No, you know what really sucks??

[ivan256]

If anything I much prefer retailers having to make the effort than having to pay higher taxes so that the state can better enforce it.

Why? You pay the costs either way, and the choice of making the retailers do the work will limit your choices in retailers by raising the barriers to entry. Worse, the distributed costs of having each retailer increase their paperwork by 50x is likely higher than the collection being centralized in government, so not only do these states want out of state businesses to enforce their use tax, they want to increase the tax and disguise the tax increase from consumers as price increases in your favorite catalog. Even after all that, the revenue from mail order taxes will likely be miniscule compared to traditional sales tax, and enforcement will still be a problem!

Re:No, you know what really sucks??

[corey_lawson]

...what is the real impact of an "e-tailer" compared to a B&M store? Well, mostly they're electronic or paid by the shipping company or US Postal, but those impacts are already taxed.

Your B&M store, however, requires fire and police protection. Your store generates road and pedestrian traffic, so those streets, sidewalks and liability insurance on those things needs to be paid for. Your store also probably generates a certain amount of...waste...that has to go somewhere. So you get to pay garbage and sewage taxes. Etc. etc.etc.

You chose a high-overhead operation. If someone can provide the same tangible service to their customers that you can with far lower overhead, more power to them, not you.

There are plenty of former Wal-marts around that were replaced by newer buildings just outside of city limits or just down the road because they save enough in lowered taxes to justify the move.
Sucks even more now for your community, but...it's Walmart's store, not yours.

Businesses use the internet also

[twocents]

Democratic businessman Rollie Heath, Owens' challenger in November's gubernatorial election, is pushing for Colorado to join the tax project.

He said that not taxing online sales puts local businesses at a competitive disadvantage.

"I just have a strong bias against having our own business having to compete unfairly with somebody who can send the same product in here from out of state," Heath said.

Sure, some businesses have suffered quite a loss due to the internet, but many businesses rely upon the internet to order items for themselves. Restaurants for wine, bike shops for parts, used book stores that buy, sell, and trade on the internet. All of these types of stores and shops would be hit by this tax as well as Joe consumer. And on top of this point, would this not increase the amount of items ordered directly from countries such as Canada and Mexico?

Re:Businesses use the internet also

[unDiWahn]

The way sales tax works (at least with what I've dealed with here in PA) only the end consumer has to pay the sales tax -- so if you're reselling something (bike parts, books, etc) you wouldn't pay a sales tax. The end user would, as always. Of course, that may mean the end user will have to pay _more_ sales tax now -- or perhaps we're not even talking about a sales tax at all.

Huh.

Actually, there's great reasons

[unicorn]

Remote merchants use FAR less resources than local ones. The SFPD rarely has to respond to problems at the Amazon offices in Seattle, etc. Any wear and tear to roads, etc caused by delivery trucks should be borne by the freight handlers, and passed onto the merchants that way. By and large, a remote vendor will use basically no local resources.

Re:Actually, there's great reasons

[jgerman]

Let me add a little to that. Considering that online retailers are using next to nothing (I'd say nothing at all) as far as state or federal owned resources. A sales tax is essentially saying "You will pay us money for the privilege of selling stuff to people who live in our geographical area". Which by itself is ridiculous. Especially since the cost is passed onto the consumer, not the retailer.

Re:Actually, there's great reasons

[spinkham]

But we LOVE taxes. You pay taxes when you make money, when you spend money, when you don't spend money and your holdings increase in value, and when you die and haven't spent all your money yet.
About the only thing you can do with money and not be taxed is to buy food or donate money to charity.
Kinda explains why we're all fat and still have sleazy televangelists, eh? ;-)

Re:Actually, there's great reasons

[lucifuge31337]

Remote merchants use FAR less resources than local ones.
Agreed.

Remote merchants use FAR less resources than local ones.
Fire taxes are a function of property valuation. If they had retail space, they would pay more based on that fact.

Any wear and tear to roads, etc caused by delivery trucks should be borne by the freight handlers, and passed onto the merchants that way.
Good idea. They already are. Vehicle registration is based on gross weight.

By and large, a remote vendor will use basically no local resources.
Which is already accounted for in the way they pay the relevant local taxes. Color me stupid, but I don't get your point.

Re:Actually, there's great reasons

[siskbc]

Remote merchants use FAR less resources than local ones. The SFPD rarely has to respond to problems at the Amazon offices in Seattle, etc. Any wear and tear to roads, etc caused by delivery trucks should be borne by the freight handlers, and passed onto the merchants that way. By and large, a remote vendor will use basically no local resources.

There has never been a "resources" argument for brick and mortar stores. So my store uses more resources than yours, do I pay more tax? No. Bars use more resources than coffeeshops (ie, cops to break up fights). Do bars pay higher taxes? No. So that argument, while the best one for not taxing the net, doesn't really hold.

To be consistent, you could also argue that all telemarketers, mail order, and online sales should not be taxed even in-state, though they are.

Bottom line is we need a comprehensive tax policy that includes the net. Especially with the steadily blurring line between clicks and bricks. Best case is a tax policy that isn't an obscene burden to collect but which allows localities to collect taxes.

Re:Actually, there's great reasons

[MemRaven]

Depends on where you are. Here in Taxafornia, you get taxed buying food (or anything else for that matter). So let's hear it for the televangelists!

Re:Actually, there's great reasons

[ivan256]

Bars use more resources than coffeeshops (ie, cops to break up fights). Do bars pay higher taxes?

Yes. In many states there is a (much) higher tax on alcohol than on other food and beverages. Some localities have an additional alcohol tax on top of that, and yet others don't allow alcohol to be serverd in public places at all.

What was your argument again?

Bottom line is we need a comprehensive tax policy that includes the net. Especially with the steadily blurring line between clicks and bricks. Best case is a tax policy that isn't an obscene burden to collect but which allows localities to collect taxes.

Sales tax is broken. We have property tax and income tax already, and we're begining to see the problems that localized sales taxes cause. The best comprehensive sales tax policy is to have no sales tax.

Re:Actually, there's great reasons

[fishbowl]

>Especially since the cost is passed onto the
>consumer, not the retailer.

I realize there are implementation details that make it an impossibility, but some costs should NOT be passed onto the consumer. For instance, environmental regulatory fines. They need to be paid by the COMPANY, not passed on to the customer, or else what's the point?

Re:Actually, there's great reasons

[s.fontinalis]

The problem with the "higher service" explanation is you have to pay sales tax on any item purchased from a store that has a presence in the state - and nowadays most retail presences are different from the mail order side. So when you live in New York State (say Buffalo) and order something from REI.com, the order is taken in Seattle, it's shipped from Seattle - and it never comes within 500 miles of the only REI in New York State. But you still have to pay New York State sales tax - even though the resource use by you is essentially the same as any other remote vendor.

Re:Actually, there's great reasons

[Kwil]

I realize there are implementation details that make it an impossibility, but some costs should NOT be passed onto the consumer. For instance, environmental regulatory fines. They need to be paid by the COMPANY, not passed on to the customer, or else what's the point?

Duh.. the fines *are* paid by the company. Who is paid by the consumer. When the company is forced to raise its prices to maintain profits and cover the fines, they are at a competitive disadvantage with their customers. If they choose to take a loss on profits instead of raising price, now they're at a competitive disadvantage with their suppliers & stockholders.

The fine is not the punishment. The fine is what is supposedly used to try and fix the damage. The punishment is the competitive disadvantage that a fined company has to deal with.

Re:Actually, there's great reasons

[DunbarTheInept]

There's little difference between a cost incurred by a company and a cost incurred by a consumer of that company. Eventually, the company has to reacoup whatever it paid by getting money from the consumer. If it fails to do so, it goes into the red and if it tries to keep doing that, it ceases to exist as a company. The only real difference is WHEN the cost hits the consumer. If the cost hits the company first, there will be a delay before the consumers pay for it. Incurring a cost onto a company merely delays the cost to the consumer for a short while.

Re:Actually, there's great reasons

[2short]

"when you don't spend money and your holdings increase in value, and when you die and haven't spent all your money yet."

Just for the record, that would be you and your heirs making money respectively. Well maybe "making" is the wrong word; certainly "getting" though.

Re:Actually, there's great reasons

[2short]

It's been said a lot of times in this discussion but:
In almost all states you are required to pay the tax regardless of who you buy from. The vendor is not responsible for collecting the tax if they don't have a presence in the state, but you are still supposed to pay it. Since tax collection based on the honor system works about as well as you'd expect, we have the initiative in question. It's not really about new taxes, it's about trying to actually collect existing taxes. The "resource use" in question is not the stores, but yours.

Re:Actually, there's great reasons

[Reziac]

Actually, CA sales tax does not apply to food purchased directly by the consumer. But last time I was in Washington state and Wyoming, both taxed food.

Re:Actually, there's great reasons

[fishbowl]

>If it fails to do so, it goes into the red and
>if it tries to keep doing that, it ceases to
>exist as a company.

YES! Exactly! Those should be the consequences of repeatedly paying, e.g., large environmental and regulatory fines, get it?

If the cost is passed on to the consumer, then there really isn't a severe consequence to the company for willful violations of environmental and safety laws -- the consequences are directly placed on the consumer, and then only incidentally to the company.

I don't have a solution that would mesh with my hands-off-business beliefs, but, I really think there should be a way to actually penalize a company for their crimes and civil foibles. If they can just pass the costs back to society, then the whole system is a joke.

Re:Actually, there's great reasons

[corey_lawson]

...but you don't pay income tax in WA like you do in CA.

Re:Actually, there's great reasons

[Reziac]

This, of course, is how Wash.state filters out poor people, to whom 8.5% sales tax (or whatever it is now, I haven't been there since the 1980s) on food is much more burdensome than the 0% income tax their tax bracket pays in most states.

ohio's method

[Anonymous Coward]

they put a line on your individual state tax return for you to pay tax on internet purchases that you haven't already paid sales tax on. i've read where they collected 50 million last year from people using this.

How about a budget cut?

[muixA]

Remeber this, taxes are rarely really cut once they are instated.

Also, has anyone noticed that the Good People who run the Govment, always threaten to cut popluar programs first, so they can justify thier continued theft.

My number one expense is income tax! It used to be housing, but I moved to a smaller place...

--
Matt

All Online Businesses move servers to Montana

[teamhasnoi]

Notice that Montana has no 'millons of dollars' in that fun little map on the bottom of the article? They have no sales tax.

Why not move your 'online store' to Montana? I'm sure some enterprising geek can setup an 'offshore' ISP for all those who don't want to deal with our money-grubbing, mismanaging Congresswores.

I'm sure there is a hole in my plan, but I just like saying "Congresswhores".

Re:All Online Businesses move servers to Montana

[taustin]

Won't help. Whatever state you live in, you have a business presence there. So you abide by its laws, too. Nice idea, though.

Re:All Online Businesses move servers to Montana

[jmcwork]

This is not unreasonable at all. If you look at most major corporate relocations there is usually some significant monetary advantage offered by the new location: major tax breaks, lower/subsidized construction costs, etc. So if Montana skips collecting sales tax, gets a (small) percentage from all sales and the e-business can sell at or below other online prices...

Re:All Online Businesses move servers to Montana

[trevor_hellman]

Of course there's a problem in your plan. They charge no sales tax, but have you seen the property taxes there? It is horrifically high. It's the same with every state. If you're not getting taxed one way, then the state makes it up with higher taxes elsewhere. Take a look at the tax rates for businesses. It is also very high.

Trevor

Re:All Online Businesses move servers to Montana

[Anonymous Coward]

They charge no sales tax, but have you seen the property taxes there? It is horrifically high.

I'd be willing to wager that they are still lower than in New Jersey, which has a sales tax.

Re:All Online Businesses move servers to Montana

[Anonymous Coward]

Hmm.. I might be movin' to Montana soon, just to raise me up a crop of dental floss. Raisin' it up, waxin' it down. In a little white box that I can sell uptown.

not suprising...

[jaredcoleman]

It's been cool to be able to purchase stuff tax free, but did anyone really think it would last forever? It just takes Congress a little time to catch up to innovation, or a lot of time if its messy. Seeing that my state has just had to seriously cut its funding for education due to lack of funds, it might not be a bad idea. One thing my pappy used to say:

There Aint No Such Thing As A Free Lunch

Re:then vs. than

[kingkade]

Dammit-- If I see this one more time, i'm gonna do something really kooky.

It's 'damn it!' not 'dammit!'.

And it's 'Cooky', damn it!

And it's going to not gonna.

See how annoying it is now?

HAND

Taxing all services

[SniffleBear]

Are they going to tax all kinds of payable services on the net? Like gambling, pron, web hosting, or web services? That would be crazy!

Re:then vs. than

[User 956]

Yeah, he also used "your" instead of "you're":

An interesting, and alarming read if your interested

Once again proving my theory that kids today are fucking idiots.

Like hell you say...

[Syncdata]

"Most states are running budget deficits, and they're looking ever more aggressively for ways to stem the erosion of their tax bases."
Like hell they are trying to stem the "Erosion" of their tax base, they're looking to create a new tax. Rather than just tighten up their states respective budget's, maybe spend less, the politician's natural instinct is to create or raise a new tax.
Internet sales will be taxed, now that the politicians understand that the business cycle wasn't eliminated, and that the internet is not some magical money machine for the economy, not to be trifled with.
I'm surprised it took this long, but then, these are politicians.

Re:Like hell you say...

[tweek]

I'm glad you brought this up. I love how we are told that we have to tighten our wallets and pay more taxes when the state and federal governments are the ones who should be tightening the wallet. Do as I say, not as I do seems to be the sentiment.

Re:Like hell you say...

[endoboy]

They're not looking to create a new tax, they're attempting to prevent a new technology from eliminating a current tax.

In most states, one of the current paradigms for taxation is "tax the purchase of goods by end users"--aka retail. To the extent that you buy your furby online instead of at toysRus, you subvert the current paradigm, and deprive the taxing authority of money that they'd been counting on..... (Note: I didn't address whether government "deserves" the money in any way.)

I fail to see any reason why a purchase from JoesDiscountRetail.com should be any more or less worthy of taxation that something bought at the corner store

Catalogue and Internet Taxation

[Parsa]

I was taxed by a company on eBay a couple of weeks ago and brought this subject up with a state investigator about these matters. Here's the rundown from what I understand.

A company doesn't have to charge you sales tax if they are located out of state. They CAN if they have an agreement with the state you are in if it's different from the state the company. Even if that company doesn't have a branch or whatever in your state. If the company does NOT charge you tax it's YOUR responsibility to go the the local department of whatever and tell them that you bought whatever item at whatever cost from whatever company and you will then pay the tax.

Obviously a lot of people do not follow this course. And most mail order companies don't charge tax because it's apparently a giant pain in the ass for them to keep track of it all. So they don't charge across the board.

So it looks to me that they aren't trying to tax something that's not taxed. They're trying to collect what's suppose to be.

Re:Catalogue and Internet Taxation

[mustangdavis]

Seriously, if the governments want to impose a tax on people, one of te best ways to do this would to be by starting with Ebay!

Many smaller "online" stores use Ebay for advertisement and a way to drum up business. Obviously, they are not going to bother with state sales tax, but Ebay knows where everyone lives. As part of the auction, Ebay could tack on sales tax (although I'm pretty sre Ebay doesn't want to get involved).

As for the other larger outfits (Amazon, etc), they will need to be required to charge tax before they would even consider that idea. It would kill their customer base. Many online retailers don't charge tax because they already have to charge shipping. If you add tax onto shipping, it becomes (in most cases) cheaper to buy from your local retail outlet.

The only way that online retailers will charge sales tax is if the fed. gov't required ALL online retailers to collect taxes for every state, using the arguement that their store front exists in every state since people can produce their "store front" on their computer screen (yes, I know that isn't how the law is written, but I wouldn't be suprised to see it changed to something like this within the next 3 years).

States are getting hurt (badly) by Internet and catalogue sales .... and they count on that revenue when they forcast their budget. Don't get me wrong, I hate the idea of charging sales tax on the 'net (I think it will kill online sales), but if the people are not charged internet tax, the states will be forced to find other means of generating revenue.

Here is one possible (really bad) scenerio:

1. States complain that their revenue is down due to Internet and catalogue sales.
2. States raise sales tax to cover the difference in their forcasted budgets
3. States are still angery that people are still buying more and more items on the Internet (due to higher retail sales tax and increased confidence in online shops)
4. States finally get their way and get to charge sales tax for ALL online stores since people are not reporting "state use tax".
5. Everyone except the state loses because we now pay higher taxes for all transactions.

Some food for thought ....

Re:Catalogue and Internet Taxation

[corey_lawson]

states already calculate all sorts of doom-and-gloom scenarios for why they need to raise taxes. Do they ever cut their pet district spending budgets (IIRC, in Illinois it is several hundred million dollars that the state legislature gets to throw around with little to no oversight or accountability), even with the budget running at a new deficit? At least in the state of Illinois, it has hard to see how this "internet tax" would generate enough money to take care of a $1 billion deficit this year... THAT is why this law is silly. Everything involved in an internet transaction has already been taxed. Maybe those taxes need to be adjusted upwards, then?

What's the downside of this tho?

[unicorn]

THink about it. If all a e-tailer offers, is an online version of a retail store. Then he truly does have to worry about things like salestaxes making the "experience" the same as retail, and thus not worth doing.

However, a smart businessman, will actually differentiate his store, be it online of offline, so that there's a compelling reason to shop with him.

I'm not in favor of more taxes, certainly. But arguing this strictly on the basis of "it'll kill generic online storefronts" doesn't sell with me at all. The government should NEVER be in the business of favoring one segment over another. If the online merchants have a reason to exist they will. But an artificial government subsidy shouldn't be in place.

Re:What's the downside of this tho?

[tmark]

The government should NEVER be in the business of favoring one segment over another.

Are you sure about this ? Don't you think it might make sense for government to offer subsidies to companies that face high development costs in industries the government thinks might be helpful to its citizens in the long run ? For instance, would you be opposed to government subsidies to support research into alternative energies ? Would you be opposed at government attempts to foster business projects in the inner cities ? What about government projects to encourage environmentally-friendly technology ?

Wouldn't all these be examples of government being "in the business of favoring one segment over another" ? And would you really say these are all bad ideas ?

If sales tax is so important...

[jcsehak]

...how do some states get away without it? I just came from Montana, which has no sales tax. Do they raise other taxes to compensate? If some states can not have a sales tax, why can't the internet also? Can it be looked upon as a virtual state?

Besides, if internet sales were taxed, shouldn't it be by the feds? They're the ones who created the internet in the first place.

Re:If sales tax is so important...

[sco08y]

...how do some states get away without it?

If you're really curious, I'd suggest a macroecon course. It's a controversial question, but there are several factors:

1. Outlays. If they don't have a lot of expenses, they don't need to have a lot of taxes. I lived in MD, and 99% of politics there is complaining about how the rest of the state is paying for Baltimore. You'll notice that many of these states don't have a big city in them, which tends to suck up huge amounts of money. That's because the cities have so many votes, so the governors and senators lavish them with handouts. To be fair to cities (except Baltimore, which just sucks) they also huge economic and cultural engines.

2. Federal money. Some states take in more federal money than others. For example, if you recall during the 2000 election that there were maps of the "blue" states (whose electors voted for Gore) and the "red" states (for Bush). Someone crunched the numbers (google Congressional Budget Office) and found that the "red" states are subsidized to the tune of $90 billion.

I'm leery of the argument that the "red" states are bludging off the "blue" states for a couple of reasons. One key problem with the argument is the implication that people are either "red" or "blue". Many people grow up in "blue" urban areas and then migrate to "red" rural areas when they want to raise a family. (Just as the best predictor of whether someone is one of "the rich" is their age.)

I should mention that I'm a conservative, so I'm not a big fan of subsidies, but at the same time I don't think there's anything inherently wrong with them. The reason I'd like to see much of this spending slashed is that private-sector solutions are more flexible and accountable.

The second key factor that the "red-blue" map leaves out is that many of those subsidies exist, in theory, to serve the nation as a whole. Defense subsidies obviously are a public benefit, but similar arguments can be made (and are when they're passed by the Senate and House) for education subsidies, farming, industry and oil.

While I may not believe subsidies are the best way to go about it, the idea that we're all in it together is morally sound.

3. Regulatory and tax burdens stifle economic activity.

This harks back to micro-econ: the law of diminishing marginal returns. There's a sweet spot where the gov't can get the maximum revenue, and it's generally not by taxing 100%. (Although there's no reason the state has to stop at 100%. I'm pretty sure Europeans pay 200% or more tax on gasoline.)

In addition, not collecting a tax gets you a big economic bonus: you don't need to enforce it.

Re:If sales tax is so important...

[jcsehak]

Very interesting. Thanks. I wish I hadn't participated in the discussion so I could mod it up as informative.

Re:If sales tax is so important...

[UncleFluffy]

I'm pretty sure Europeans pay 200% or more tax on gasoline.

There was an interesting article on this in the Economist [1] discussing the optimum level of taxation on gasoline and contrasting the American and European (particularly British) approaches. The report cited considered the negative externalities (health costs, traffic congestion, pollution, etc.) and looked at what the taxation level should be to cover these costs. The conclusion it came to was that the "correct" level to make the use of gasoline pay for the damage it caused (let alone act as a revenue source) was about 125% [2]. Of course, this doesn't consider the effect of gasoline use on the larger economy, but it's an interesting starting point.

[1] If you don't have a paper subscription, get one. Best single world news source I've found and usually written with both wit and precision. Perfect bathroom reading. The article itself is paid content, but if you want to find it search for "Fuelling Discontent" on the Economist web site. I think it was in the May 17th 2001 print edition.

[2] According to the article, US tax on gasoline is about 35%, UK tax is about 250%.

Re:If sales tax is so important...

[sco08y]

Thanks!

We are already required to do this!!!

[opto]

Welcome to North Carolina, USA folks. There is a nice little worksheet on our state tax form to report online and mail order purchases and pay state sales tax on them. So if this is offloaded to the companies selling the products, the prices will just go up. Simple economics.

Re:Great idea: Make things harder for online bidne

[danger42]

Since when is it the job of government to make certain sectors of the economy profitable? ok, since the early 20th century, propping up farmers and steel producers.

But the end result of not allowing taxes of online commerce is that there will be government subsidies to states that have online businesses.

That's ridiculous.

drive prices up for the consumer

Now, you're not even trying to see the state's side of this. They don't look at it as increasing prices, but rather, increasing tax revenue to increase services to the state's inhabitants.

Can you really justify not giving the poor people of California, Massachusetts, and Virginia the food stamps and Section 8 housing checks they so richly deserve?

Taxing Imports != foreign investment

[Amadaeus]

Products "Made in the USA" outnumbers products at least 100-1 in China. Products "Made in China" outnumbers products at least 100-1 in the USA. Putting further import taxes would actually INCREASE the prices of general products overall because import tariffs would give FURTHER dis-incentives to investors from importing products into the USA, and since there is less foriegn competition, domestic producers would be free to increase prices because they have a virtual domestic monopoly. Increasing import tariffs would actually be worse off for both the consumer and the long-term economic outlook. Sure, GDP will rise, but at the expense of worker livelihood and domestic morale. One more thing: China has a extremely high GDP not because of economic tariffs, but because of the political circumstances surrounding its tradidional isolationalist thinking of "Motherland products are best".

Re:then vs. than

[davejenkins]

dammit Pronunciation Key (dmt)
interj. Used to express anger, irritation, contempt, or disappointment.

kooky also kookie Pronunciation Key (kk)
adj. Slang kookier, kookiest Characteristic of a kook; strange or crazy.

gonna Pronunciation Key (gn)
Informal Contraction of going to: We're gonna win today.

All taken from a modern dictionary. 'then' instead of 'than', is just piss-poor (and misleading) grammar.

Yes-- I have nothing better to do on a Monday night (bows head in shame).

They are treated the same...

[unicorn]

Mail order houses don't pay sales tax either, typically. Unless they have a physical presence in your state.

While this article is pitching the target as e-commerce. I'm positive that they will attempt to aim the taxes at catalog sales as well.

Jurisdiction?

[Dirtside]

So I wonder who exactly has tax jurisdiction over a purchase made by an individual in one state from a company in another state. Certainly if I buy something from a company in my own state, then the sales tax is only collected once. (At least, in theory.) If I buy something from another state, then my state will insist that I pay it taxes on the money I spent, and the other state will insist that the company I'm buying from pay sales tax on the merchandise it sold.

Since sales taxes are generally levied on the merchant (and the merchant passes that tax right on to the customer), it seems like the "logical" solution is that a company doing business in a state has to pay sales tax on every item it sells in that state, regardless of who it sells to or what state they're in. The person buying the item only pays sales tax insofar as they compensate the merchant for the sales tax that the merchant is legally required to pay.

Someone else pointed out that the Constitution says that Congress has the power to levy taxes. However the Constitution does not say that the states cannot also have that power in some form. Can anyone shed some light on this?

Re:Jurisdiction?

[taustin]

Since sales taxes are generally levied on the merchant...

No, they're not. They are levied on the buyer. The merchant is required by law to act as a tax collector for the state. This is why the Supreme Court will not allow a state to tax mail order transactions going out of state - if I live in California, Nevada cannot compel me to act as a tax collector for Nevada.

This plan would, in theory, let California require me to act as a tax collector for Nevada, with a reciprocal agreement doing the same in Nevada.

However, the plan, as written, will conflict with existing Supreme Court case law, which simply does not allow sales tax to be charged on out of state transactions. If this passes, it will be challenged, and will go to the Supreme Court, and will have an uphill battle the entire way.

RTA

[dnoyeb]

The article clearly states that the tax is charged to the retailer based on his location. It says nothing of the customers location.

I do pay my use tax so fuck off....

[Anonymous Coward]

My state Michigan's state income tax form includes an area where you can calculate your use tax from your receipts or as a fraction of your Gross Income. At my currently salary it comes out to $6/year. At Michigan's 6% sales tax that the same as spending $100 in a store, and I spend alot more online.

So stop trying to group everyone together. Do you pay your use tax?

Comment removed

[account_deleted]

Comment removed based on user account deletion

It ain't gonna happen...

[taustin]

...which include requiring states and its local jurisdictions to have the same tax rate...

Yeah, that's gonna happen. About the time Microsoft GPLs Windows.

Already tools to do this

[peter303]

There are software tools already to figure out the sales tax by every zip code in the country, and which goverment level gets which slice. The zip code would be taken from the recipient's delivery address. Perhaps the post-office or UPS may be require to collect the actual tax.

2 bad u can't see it

[dnoyeb]

This will certainly create a competitive relationship between states. Local communities are already being pimped by sports teams and corporations for tax breaks and new stadiums. This will create a competitive atmosphere where one state will undertax the next, and in the end, unless they all have similar tax levels, merchants will simple go to the location with the cheapest tax. Remember internet companies are easy to move.

Who loses?

[mcubed]

The report estimates that all 50 states could collectively lose more than $45 billion in Internet sales tax revenue in 2006.

Hmm, states can lose money that they don't currently collect? Isn't this a bit like saying, "Microsoft could lose more than $10 billion in annual revenue in 2006 if the government switched to Linux"? [Note: No, not a gratuitous MS swipe - I don't think MS would be so obnoxious as to use this phrasing.]

How about, "All 50 states stand to gain more than $45 billion in revenue by imposing a new tax they are not currently in a position to impose"? Seems like a more accurate rendering of the situation, although still somewhat hyperbolic since all 50 states are not considering this proposal. Some states don't have sales tax, period.

Michael

Re:Who loses?

[FattMattP]

Isn't this a bit like saying, "Microsoft could lose more than $10 billion in annual revenue in 2006 if the government switched to Linux"? [Note: No, not a gratuitous MS swipe - I don't think MS would be so obnoxious as to use this phrasing.]

You must be new to the computing world.

Re:Who loses?

[Quimo]

The problem is that if the purchases where made from a local store they would be taxed. As more and more people make purchases on the internet (and don't properly report for tax purposes) they will eventually end up loosing $45 Billion in tax revenues. Nothing gained only lost due to the method of purchase.

Re:Who loses?

[mcubed]

As more and more people make purchases on the internet (and don't properly report for tax purposes) they will eventually end up loosing $45 Billion in tax revenues.

See, that's exactly what the way the report phrased the statement wants you to think. They won't "lose" any tax revenues because they are not currently set up to collect sales tax on Internet sales. If I buy a book from Amazon.com instead of a local bookstore, the state loses the sales tax they would have made if I had bought the book locally instead. But most the books I buy from Amazon.com are not available locally, or they are only available new locally and I buy them from Amazon.com used. These are purchases the state would not collect sales tax on unless they start taxing Internet sales. I would not make these purchases locally, regardless of the tax situation.

Also, the report says specifically that all 50 states would "lose more than $45 billion in Internet sales tax revenue," not "in local sales tax revenue lost to Internet purchases." This makes it sound like a foregone conclusion that states ought to be taxing Internet purchases, rather than making it sound like a new tax, which is what it really is. If the state doesn't impose a special tax on widgets, is it "losing" widget tax revenue? Or is it opting not to impose one of any number of new taxes it could impose at its whim?

Michael

What would be the point?

[Pan_God_of_Gods]

IMO the only real advantage to buying online would be not paying tax. I can usually get the same items at a local store for the same price, and not pay shipping. Nothing beats that instant gratification.

Re:LOSE

[GMontag]

Oooooops! Typo, my bad, thank you.

Montag

Price of success... Taxes

[salesgeek]

It's great to see that the internet has succeeded to the point that government wants to tax it. What's too bad is that many ecommerce businesses see their only advantage to be price. And if 4.5-9% in sales tax will cut into your orders that much, you are already among the living dead. Those that live by price, die by price. You can't make money selling $.99 for $1.00. For that matter, it's damn hard to make profit selling $1.00 for $1.10.

$G

True for Michigan

[dnoyeb]

I posted somewhere above that this was the case for michigan. I got moderated as flamebait...I question why?

The tax in place [that you speak of] is for the consumer. The article is speaking of retailer tax based on retailer location. People don't seem to read far enough to understand this..

Re:True for Michigan

[Anonymous Coward]

Probably some mod was masturbating to video on his computer from his hidden cam in his mom's shower, and accidentally smacked the keyboard with his fist. That's the only reason I can think that mods do the fucking rediculously stupid things they do. But I make it my purpose to mod them all down to nothing, so they never mod again.

Anonymous MetaMod

Bad Economy = New taxes ?

[Anonymous Coward]

Am I alone in thinking the US economy is not so bad ? Yes companies are dropping like flies and people are losing their jobs. However I also see plenty of success within families and small companies. Looks to me like this unrealistic fantasy has burst for the large corps and their employees. We have simply come back to reality. The US is one of the most well to do countries, so I can hardly feel bad about the overall situation.
I listen to same drivel about why the US economy is bad and wonder who's economy they are talking about ! It bears no resemblence to economics I studied during school.
They neatly separate everything into consumers/spenders and sellers. If the consumers are not throwing down money on frivolous junk but rather save for more important things to improve their lives all of a sudden the economy is bad. Seems to me the economy they talk about is where the rich get richer and poor get poorer.
This net taxation is just another money grab with a convenient excuse. Unjustified and unrepresented. Hell if it has anything to do with the economy hurting state governments. Rather more of a result of the mismanaged bureaucracy that they are. Throwing more money at mismangement never helps.

Ahh Im done ranting..

Re:Bad Economy = New taxes ?

[bryan1945]

Seems like everyone ties the health of the economy to the DOW, or the NASDAQ, or what have you. Companies' stock fluctuate wildly day to day if they say they are going to only make 9% growth this quarter instead of 9.5%. Look at all of the recent accounting scandals, upper management cooking the books to raise stock prices so they can sell their shares and leave town. It looks like corporations, especially the larger ones, having been living off of a shaky business for a while now. There's something wrong when it's bad that you made $100M because you made $100M last year (or worse, last quarter), you should have made $110M!

As for the taxation law, repeal the loophole and let them operate like all other out of state businesses- the buyer is responsible for paying the sales tax directly to their state.

And we don't need a new tax. The water in my house is taxed! But this is a different argument for a different time.

Re:Bad Economy = New taxes ?

[Reziac]

I sell a middle-class luxury product. That means I only make money when the middle class has disposable income (ie. significantly more money than they need to get by). Fall is normally my worst time of year. Yet this fall I sold SIX TIMES more units than I would normally expect for the period. (And I could have sold 20% more, but I ran out of stock.)

Second, after 30 years experience, I've noticed that when times are bad, I see only checks. When times are good, I see more cash. About half my fall sales were paid in cash.

Despite the stock market's yoyo act (tho a few stocks have gone UP during this adjustment!) it looks to me like the mainstream of the U.S. economy is doing quite well.

BTW, there are plenty of politicians who think the solution to a slow economy is higher taxes. They're usually called "democrats". :)

Re:Bad Economy = New taxes ?

[corey_lawson]

...no, they are called politicians. They all have pet projects that need to be funded or horse-traded. Decreased funding makes life tough for them.

Re:Bad Economy = New taxes ?

[Reziac]

Hmm. Maybe a starvation diet would do them good!!

quite easy to enforce

[peter303]

First, everything on the net is computerized and leaves a digital trail. Much easier to trace than face-to-face transactions.

Second, the choke point are the delvieray services. There only a few of them. They could be forced to collect the tax as postage. Much like the charges on your local phone bill for taxes added by any telco service you use.

Apple computer already doing this?

[Arcturax]

I bought a new G4 a couple weeks ago from the online Apple store and they charged me tax anyway. Is it because they are shipping from California (probably some goofy CA law) or did they forward this on to my state?

I don't know which but I do know that I did have to pay tax and wasn't too happy about it either.

Re:Apple computer already doing this?

[FreeLinux]

You had to pay because Apple, most likely, has a business presence in your state. This may be a distribution facility or, more likely, an Apple store. With the presence of a retail outlet in your state, they are required by your state to collect local taxes on all sales within that state. It doesn't matter that you placed the order and had the product shipped from California. Many states have had this law in place for quite some time.

Re:Apple computer already doing this?

[Arcturax]

Ah, that would explain it. We have two Apple stores here in Ohio and Apple also (or used to anyway) have a building in downtown Cincinnati. I remember getting a tour of it back in high school (1992 or 1993 I think) because my physics teacher's husband worked there. I remember them demoing Quicktime, which was a brand new thing back then and being in awe of it as well as of the Powerbooks they let us play with.

Ok, offtopic there, but that would explain why I got taxed. Thanks for the info!

Re:Apple computer already doing this?

[sco08y]

Apple has a business presence in all 50 states. That's why it's good to buy Macs from smaller resellers.

Some Sites Already Charge Taxes...

[TooCynical]

I purchased a washing machine on Sears.com this weekend and was charged tax - on the machnine and the delivery fee.

I don't care either way but if e-commerce transactions are going to be taxed then it should be more consistant - not just willy nilly taxation when a company feels like it.

Re:Some Sites Already Charge Taxes...

[jafiwam]

You got taxed on the purchases because Sears has a presence in your state somewhere. (One store would count.)

You will probably find that smaller organizations are less likely to have a local presence, and will therefore be less likely to charge sales tax.

GST, in Canada.

[weetabix]

Collecting this tax will cost more than the tax can produce itself.
GST has been a losing battle for the government up here for years. That never stopped them. No offense, but the american government isnt any brighter about things like logistics of taxation than our own french mistake.

Taxing Internet/catalog sales: consumer wins

[Freedom Bug]

If local businesses are charged taxes and mail order businesses aren't, this is a non-level playing ground, which is in inefficiency in the system, which is bad for the consumer.

Many people have mentioned that they bought over the internet because they didn't have to pay tax, but they otherwise would have purchased locally. Purchasing locally you get to visually inspect the merchandise, which is a benefit to you, but one that you are not willing to pay X% for.

But somebody has to pay that tax anyways. Basically you all are saying, "let's take that tax out of the pockets of the technically incompetent instead." Why not just lobby for a special tax break for Slashdot readers and get it over with?

Of course, you Slashdot people also like it because it's a special subsidy for web merchants. Of course, you're free to whine when your tax money is going to any other special interest business. How about a subsidy for Microsoft? It may well be the most successful racket anybody has going to transfer money from the rest of the world to the United States. Surely that's a worthy cause?

The internet has been great for lowering prices: it reduces the cost of information. It'll continue to do so in the future even if a few borderline dot coms go under and a few more bricks and mortar shops do well. pricewatchSanFransisco.com may become more useful than pricewatch, but that's about it. The market for computer hardware is one of the most cutthroat around, and it'll stay that way.

Bryan

Point of Clarification

[dnoyeb]

OK, you ARE supposed to be paying local state tax on all of your across the border orders. The new tax is however a tax on the RETAILER not the customer as most seem to be missing.

The tax we are required to pay today that most ignore is based on customer location, this proposed tax is based on retailer location.

Re:Point of Clarification

[Anonymous Coward]

Ummm, huh? I think it's quite a bit more confusing than that.

My understanding is that most state sales taxes were taxes on the retailers. CNBC, while not the greatest but they have a clue, covered this issue a few months ago. While collected at the point of sale, the responsible party for the tax is the retailer, not the consumer. Retailers simply (obviously, understandably) passed the tax onto the consumer at the time of puchase.

Most state laws (following the CNBC coverage) seem to state that if you, the customer, go across state borders and make a purchase, and then bring it to the place where you reside, most state laws cover this and put it on the consumer as the responsible party to pay the tax (not the retailer across the border, who may still tax you according to his state laws; the tax the consumer is responsible for is subject to the laws in their state of course, e.g. in PA, you can buy food in MD and, at least on the tax side, bring it in without worry about sales tax). However, no state government I know enforce this, because it's near impossible and just plain stupid.

In south central PA, I've heard of folks that drive down to Maryland to avoid the state liquor tax. Everyone knows the police are not going to pull you over unless they bleepin see you drive in and out of a store, with PA plates, and the back of your car is going to hit asphalt. I know people in the Philadelphia area head down to Delaware to buy laptops and desktops to avoid the PA sales tax (during the 50 non tax-free weeks). (e.g. I've been told but never heard from a reliable source that Delaware has no sales tax but has a 1% retailer tax that supposedly must remain hidden...very odd if true).

Re:Point of Clarification

[anthony_dipierro]

Most state laws (following the CNBC coverage) seem to state that if you, the customer, go across state borders and make a purchase, and then bring it to the place where you reside, most state laws cover this and put it on the consumer as the responsible party to pay the tax

BTW, it's called "use tax", and at least in New Jersey you pay it at the same time as income tax, it's one of the lines on the form.

However, no state government I know enforce this, because it's near impossible and just plain stupid.

There are at least two times it is enforced though - upon the purchase of automobiles from out of state (they get you when you register), and upon large corporations for large purchases (they audit them).

Easy solution

[Rupert]

Tax the UPS and Fedex trucks at the state line.

Re:Easy solution

[craw]

The people in Hawaii are going to love this idea!

that's funny....

[ChuckMaster]

I thought we gave tax BREAKS to struggling businesses when the economy is down. Hasn't e-commerce taken enough of a beating yet?

They may TRY TO tax it, but cannot TRY AND tax it

[yelligsc]

Seriously

Think about it. What does the construction "try and" mean? Nothing.

Scott.

Sales of intangible goods

[Xformer]

What about those of us that sell things that do not involve physically delivering something to the buyer? This includes mainly unlock codes for shareware and things of that nature.

Most of the time, in those cases, you don't have any idea what state or even what country someone is coming from, especially with .com and other formerly US-only TLDs showing up outside the US. Getting a user's address only to charge them a sales tax if they're in the US (there'd be no other reason for it) is only going to get people to start lying and/or not going through with the purchase in the first place.

Foreign buyers

[Glytch]

There's been a lot of comments on interstate internet purchases, and hwo the buyer has to pay their own state's "use tax", but what about buyers from other countries? I'm specifically wondering about Canada. Usually when I buy a DVD or CD it's just mailed through the postal service. Are tariffs built-in to the cost of shipping to another country?

(Offtopic, but I'd just like to say that the Canada/US exchange rate royally sucks. After shipping and exchange, that nice ebay bargain you've just found usually doubles in price.)

Re:Foreign buyers

[Anonymous Coward]

For the UK, if it's over £17 sterling, then it is liable to UK VAT.

Less than that, and they don't bother.

Re:Foreign buyers

[Anonymous Coward]

The post office examines the package and collects duty. (However, at least into the UK, packages containing goods under GBP 18.00 are not taxed. CD-WOW exploits this by sending CDs in *individual packages*, each containing one CD valued at GBP 8.99, so that customers who order three or ten CDs at a time are not hit for the duty.)

If you order a CD from CD-WOW (www.cd-wow.com), you will find a green customs label printed onto the box. Goods without such a label (except wholly within free trade areas) may be liable to seizure.

Re:Foreign buyers

[j-beda]

When someone sends stuff through the mail from the US to Canada (or visa versa) they have to fill out a little customs form provided by the post office. Then when it gets delivered the postal person can collect taxes, duty, and handling fees ("brokerage fees") from the recipient. In practice, most items under about $20 are not charged anything, but I frequently pay GST and PST plus $5 brokerage to Canada Post when receiving stuff from the USA. Note that other methods of delivery (UPS, FedEx, etc.) can have varrying brokerage fees, some of them are pretty huge, which is why I stick to the postal system when possible.

Read the Article

[dughat]

The article states:
But the Supreme Court has ruled that states can't tax sales from electronic retailers that do not have a physical presence within their jurisdiction.

The court decided the requirement would put an inappropriate burden on e-tailers, especially with some 7,500 sales tax jurisdictions in the country that each have different collections procedures.

The Streamlined Sales Tax proposal, on which delegates from the 29 states will vote on Nov. 13 in Chicago, would simplify tax collection procedures. If passed, it would become effective after at least 10 states meet the provisions of the agreement, which include requiring states and its local jurisdictions to have the same tax rate. ...
"The end game is to go to Congress and say 'We have now simplified this enough so that it's no longer an inappropriate burden on interstate commerce and we would like you to tell retailers that they have to collect sales tax for states who have joined the agreement,"' he said.


In other words, if the states agree on this proposal, they will then go to Congress and ask that it become law, in line with the constitutional requirements. The state is not taxing the business across the states anyway, they are taxing you, a resident of their state. They're just making the business help.

Re:Read the Article

[buzzcutbuddha]

But they are still taxing commerce across States, and the Constitution clearly says that Taxes cannot be levied againsts goods exported from a State.

Note that it does not say that States have the right to levy taxes, it explicitely states in Article 1, Section 9, that taxes may not be levied against goods exported from a State. So if I buy something from Amazon.com and it's shipped from California to my house in Pennsylvania, I'm exempt from taxes. Period, end of debate, no questions asked.

States have tried for years to get this overturned, but the Supreme Court has ruled time and again that taxation of that form is not legal.

Re:Read the Article

[dughat]

I agree that California could not tax you, or the goods, or whatever. But Pennsylvania can, because from their perspective the goods are imported and thus taxable. I'm more familar with Massachusetts which can and does tax things imported. If you buy a car in New Hampshire, you can't register it in Mass. until you pay Mass. sales tax (NH doesn't have a sales tax).

The states want to tax items imported by Amazon, not items exported by Amazon. So if I order books and they're shipped from Virginia, it's Mass. that gets the money, not VA. And the court has ruled that if Amazon has ANY presence in the state, Mass can require that they collect sales tax. With Gateway, they do.

But the laws already exist...

[hafree]

Why is it that US lawmakers always feel the need to create new laws that overlap issues already covered by existing laws? Buying something online is no different from buying that same item from a mail order catalog. If you live in the same state as the store that sold you the item you pay sales tax, otherwise it's not an issue. The same thing happened recently with internet radio, when the definitions of distribution vs. public performance and what royalties were owed to who were already clearly defined in the 1976 copyright laws. If this is about taxation of interstate commerce, then call it just that - don't target e-commerce like it's something special simply because the advertising medium is different.

Read the constitution

[elzbal]

It ain't gonna happen:

US Constitution, Article 1, Section 9:
No tax or duty shall be laid on articles exported from any state.

Link to US constitution at the Library of Congress

Nothing short of a constitutional ammendment can allow this tax.

Cast the First Stone

[Greenisus]

IANAL, but I did grow up in the first state to have a sales tax. The way I see it, if we're all going to complain that the **AA should have to figure out a new business model to stay competitive, then the same should apply to online retailers. I don't want to pay taxes, but it's a free market. Suck it up and keep fighting.

Re:then vs. than

[IndependentVik]

See how annoying it is now?

Wow, you're right. You are indeed very annoying.

Here's an idea!

[Cervantes]

Hey, I have a fabulous idea to solve the evils of internet business creating deficits and starving the children:

Try balancing your budget!

I mean, sheesh, really, how hard a concept is that? Now, before you charge for that reply button saying that it's impossible, I point out that I live in Alberta. We used to have a multibillion-$ deficit and no end in sight, but we voted in competent financial leadership, and turned it around. Now we routinely post a $1B surplus, have a $17B trust fund for "rainy days", and will have the entire deficit paid off in a few more years. Add to that our free health care, 0% (yes, ZERO) provincial tax, copius social programs (school, welfare, etc), and somehow i fail to feel sympathy for states running $600 billion dollar deficits every year. I wouldn't be asking what we could tax next, I'd be asking why these jackasses were still in office.

And yes, to answer your next question, it was kinda hard... we lost or had cutbacks in alot of programs that we'd gotten used to having for free.. and it's still going on. But the money we save from interest payments on our debt means that we'll be able to reinvest in a few years. And with 1/10 of the entire country living here, yes, we have lost our fair share of business to internet commerce.

Ok, /rant off, but still, sheesh, how can you people put up with that kind of fiscal management? We elected the right people, passed a non-revokable law that said "No budget deficits, ever, for any reason", and that was that. The question isn't why shouldn't you tax IC, but why do you have the need to?

Also, if you bothered to RTFA, take the budget deficits for the state, and subtract the "claimed" losses from IC. Doesn't balance out to 0, eh?

Re:Here's an idea!

[wmspringer]

>but we voted in competent financial leadership,

So did we. (The United States) Unfortunately, then his term expired and we ended up with a Republican in office...

Re:Here's an idea!

[j-beda]

Easiest way to balance your budget: inherit a bunch of money from your rich uncle.

Alberta may well have had excellent financial management, but it also had a huge windfall in the form of vast amounts of natural resources (oil and gas) and a good market for those resources. It is not clear that things would be as rosey if the province was a little less blessed by providence.

Now why AB can't afford to do the right thing by Kyoto if they are so well off is another matter :-)

So much for Slashdot and superior intellect

[sunking2]

Your/you're and then/than is not that difficult to master. It is pretty sad when both are the span of a few sentence submittal.

Rules already in place.

[PerlPunk]

AFAIK, if you purchase something from out of state, whether it is online or over the phone, you have to pay sales tax on whatever you purchased IN the state you live in. Otherwise, if you purchase something online and the vendor happens to be in the same state, then they are responsible for remitting the tax.

Why is it like this? Because of where your taxes go. Taxes are collected by a government to provide services to those being governed. So if someone from Colorodo purchases something from someone in Maryland, why does the seller in Maryland have go to the trouble of remitting tax money to the state of Colorodo when he receives no benefit whatsoever from that state?

And like many people here realize, that if the burden of remitting taxes to each locality from which someone purchased an item is to be borne by the seller, then trying to remit tax money to the literally hundreds and thousands of localities (according to their differing laws) quickly becomes ridiculous. This will surely break all but the biggest online businesses.

Online transactions shouldn't be taxed period

[dh003i]

Because they don't use the states resources.

A local shop or store uses the states resources. It relies on the state's police officers to ensure that it isn't vandalized, and to prosecute anyone who steals. It relies on state money which supports and repairs the streets which give access to that shop or store.

Online businesses don't rely on state resources, or if so only very very rarely and in minor regard. Thus, they shouldn't be taxed.

The other problem with online taxation is that its taxation without representation. If a company is based in NY, it is only represented (in terms of state law) in NY. But lets say that the servers for its products which it sells online are in California. Thus, the company would be taxed in California, without representation. The same thing occurs for us citizens.

Those are some good reasons why online taxation shouldn't be allowed. Here's another one -- its called the will of the people.

How many people can you find (anywhere) that want to be taxed online, so they have to pay online taxes in addition to shipping and handling? Has anyone asked the people about this, or even mentioned it in an election? No. My guess, 99.99% of the people in America don't want online taxation. So we shouldn't have it. Its called Democracy.

"Most states are running budget deficits, and they're looking ever more aggressively for ways to stem the erosion of their tax bases."

Here's a suggestion: fire some of those useless paper-pushers. Get rid of obsolete programs and organizations. Stop letting greedy fucking politicians vote to raise their pay every year. The states have a money problem -- that's their problem. They mismanaged the money we gave them with our taxes. Now they want to punish us by adding more taxes (this very cowardly way to do it, add new taxes, instead of raising existing ones). Probably upwards of 80% of the money you give the state in taxes is wasted anyways. Try cutting off some fat first.

In any other facet of life, people are held financially responsible for their money-management. Where else in the US can you keep on fucking up with money and always get more precisely because you fucked up? Where else do you get to run enormous budget deficits without the plug being pulled on you?

I get really sick and tired of hearing about how the states don't have enough money. Taxes are raised at a much faster rate than inflation devalues money, and they always need more money. Apparently, the government is like God. All-powerful, all-knowing, all-wise, but just can't handle money.

Re:Online transactions shouldn't be taxed period

[SuperJim]

Yeah right....

A local shop or store uses the states resources. It relies on the state's police officers to ensure that it isn't vandalized, and to prosecute anyone who steals. It relies on state money which supports and repairs the streets which give access to that shop or store..

And I guess all the things you buy online just materialize when you order them, they don't need to be produced and stored in warehouses? But you're right, warehouses and factories don't use state resources...

My guess, 99.99% of the people in America don't want online taxation. So we shouldn't have it. Its called Democracy.

So by reasonning all the other taxes (income, sales, etc) exist because the people want them? Ask around, I'm sure that 100% of the people would rather NOT pay income tax, or any tax for that mather.

I agree with the mismanaging part though.

Re:Online transactions shouldn't be taxed period

[orotas]

Online businesses don't rely on state resources, or if so only very very rarely and in minor regard. Thus, they shouldn't be taxed.

The first problem with this statement is that sales taxes aren't a tax on the business, but rather a tax on the buyer. They appear to be a tax on the Business because the business is forced to collect and forward the tax to the government.

The other problem with online taxation is that its taxation without representation.

Again, not true, the person being taxed is the buyer not the business.

My guess, 99.99% of the people in America don't want online taxation. So we shouldn't have it. Its called Democracy.

So which tax isn't that true about? No one wants to pay taxes. Also, most online purchases are already subject to a use tax that most people simply don't pay. Most states have tax statues on the books that require residents of the state to pay a use tax for any item that they purchase from an out state vendor that isn't subject to sales tax. Most people simply ignore this because the state typically doesn't have the resources to enforce the laws.

Where else do you get to run enormous budget deficits without the plug being pulled on you?

This isn't the federal government we're talking about it is the states. Most states have state constitutional limits on deficit spending, in a lot states it is completely prohibted. Which means that in times like this they can't borrow in order to get through the recession and then pay it back later, they need to the revenue now!

Taxes are raised at a much faster rate than inflation devalues money, and they always need more money.

Where are you living? I know that in the state I live in, and in a lot of other states, taxes have been reduced over the last 5 years. In fact the rash of tax cutting during the boom is what is causing this problem. Taxes were cut well below sustainable levels because of the boom. Now that the boom is over the states are feeling the results of those irresponsible cuts.

Probably upwards of 80% of the money you give the state in taxes is wasted anyways. Try cutting off some fat first.

80%, don't be silly. Some fat may exist, and will always exist, but lets be serious. The fact of the matter is that any bureaucracy is going to include some waste, but we all need a certain amount baseline services from our state and local governments and those services are in jeopardy right now. Most people whine about their tax load, and then in the next breath whine that the police don't answer calls fast enough, or fix the potholes fast enough, or that the school system sucks, etc. All these things cost money, and there is only one place to get it, taxes. Online transactions seem to be a perfect place to get the taxes to politicians. It is the classic hidden tax, they figure most people won't notice and won't complain.

If you really want to make an argument against online taxation you should talk about how it is unfair to force businesses in Texas to collect the state of Arizona's taxes. Or make an argument that taxing online transactions will kill this growing market and the states need to wait until the market matures to tax it.

Re:Online transactions shouldn't be taxed period

[dh003i]

And I guess all the things you buy online just materialize when you order them, they don't need to be produced and stored in warehouses? But you're right, warehouses and factories don't use state resources...

Yes, they do just materialize out of nowhere if the customer is buying something like a software program which can then be sent online. Even if its a normal order (for say a steak), the factories and warehouses that they use to store things won't necessarily be in the same state where there server is, so that state still has no right to tax tehm.

Re:Online transactions shouldn't be taxed period

[dh003i]

If the states need the revenue NOW that's their problem. Unlike most politicians and government paper-pushers, the average American works hard, and has to fork over a large percentage of his money to the government in taxes.

Quite frankly, the only thing which should be taxed is yearly profits -- income tax. Taxing someone on the goods they buy is double-taxation; you tax them when they make the money, then you tax them when they buy something, then you tax them again when they sell that something. The government has found sneaky ways to tax people a thousand times over on the same money. There should be one tax, an income tax. Make it big enough to account for not having any other taxes, but there should only be one. We'd save trillions of dollars from not having to do the complicated IRS checks, and we'd all be able to do our taxes in a few seconds ($100,000 * 0.3).

It is exactly because this is a hidden tax that its disturbing. The government can legislate this without facing any consequences; its akin to zero transparency. The government gets to do something controversial and unliked by the vast majority of the people, yet faces no criticism. That's more like a dictatorship than a democracy.

"Some fat may exist"? What are you, a government employee or something? Alot of fat exists. Most of the money we give to the government is wasted -- either spent paying people too much for doing too little (refer to paper pushers, and to politicians who keep on voting to raise their own salaries), or spent on ineffective programs which don't work, or spent on other non-sense. One city spent several million dollars building a statue of fucking Dr. Seuss.

I can list several ways in which the states and the US in general could save trillions:

1. Get rid of NASA. Who the fuck cares if we can get a man on the moon or on Mars or whatever? Who cares if a monkey shits in space or doesn't? The billions spent on NASA should be spent researching things that can help human beings, like cures for disease, or not spent at all.

2. Stop government funding of theoretical physics. Theoretical physics is great, but it isn't going to benefit the public if we know every little detail about black holes or not. Again, money better spent on something else.

3. Stop letting Congressmen and Senators vote to raise their own damn paychecks. The salary for being a Congressman or Senator should be enough to make a person "well off" not absurdely rich. Furthermore, their pay should depend on their performance, like everywhere else in the world.

4. Stop letting Congressmen and Senators and other government officials pamper themselves with OUR tax dollars. No first class plane tickets, no 30-passenger limosuines, none of that luxery bullshit. Let these fuckers fly in coach and drive in bargain-value cars. In fact, mandate that public officials always use the cheapest form of transportation for the given need. This is no different than the bullshit with Britain, where the British people work their asses off to keep the Queen and her bastards living in billion-dollar luxery.

5. Also, lets do away with these mansions we give our congressmen and senators, and lets do away with the free services they get in them. They want to live in a mansion, pay for it with their money, like everyone else would have to.

6. Eliminate all taxes in favor of one tax, the income tax. People's income tax should be linearly proportional to the percentage of money they conribute to the GNP. This will save billions of dollars in paperwork, wasted time, and IRS-audits.

7. Stop making public buildings stately. Those fancy pillars on court-houses just make them more expensive. Same thing with any other public building. It should be functional for its particular needs, nothing more.

8. Pass a constitutional Amendment requiring that all branches of government and all divisions from highest to lowest run a balanced budget. This way, we don't get swamped down in interest fees.

9. Mandate that government not grow at a rate faster than the general population grows at. If the population increases by 10% over 10 years, the government should not increase by 100%.

10. Stop letting politicians use our tax dollars to fund their election campaigns. The witch Hillary Clinton did that for her NY campaign.

11. Get rid of useless programs. Most government programs aren't doing what they're intended to do and simply will never work -- get rid of them.

12. Fire useless employees. The government should be a safe heaven for employees who do their job, but not for those who slack off. Fire them.

13. Legalize prostitution, regulate it (reasonably), and tax it. This will produce enormous amounts of money for the government, while not imposing a great burden on society. Aside from the economic reasons, prostitution should be legal because its a (wo)man's body, and it should be his or her choice on whether or not to sell it. Why should it be illegal to sell something which is perfectly legal to give away? Fucking is legal. Selling is legal. Why isn't selling fucking legal? As an interesting side-note, our cops waste alot of our tax dollars catching and prosecuting prostitutes; that money would be better spent prosecuting real crimes, like rape and murder. Even for those of you idiots who think prostitution should be illegal, you have to agree its better to catch and convict 1 rapist than to catch and convict all the prostitutes in the US.

14. Same with gambling. The government is hypocritical by not legalizing gambling, as the state lottery is gambling. Again, introduce appropriate regulations and tax.

15. Same with drugs. The war on drugs has been a complete flop. Drug use has, if anything, expanded faster than the rate of population growth. The simple fact is, individuals make their own choices. I couldn't care less if someone chooses to screw up their lives. (But "being high" shouldn't be an excuse for crimes). Legalize it, regulate it, and tax it. Again, this reduces the burden on the general population. For #13, #14, and $15 by taxing the respective activities, you'd save money by not having to prosecute them.

I could go on. But off the top of my head, I've identifie 15 ways in which the government wastes money, and ways in which it could alleviate that waste. Sure, alot less people would want to be politicians, as it wouldn't come with all the perks. But that's a good thing. This way, the people who did want to become politicians would want to become that because of the right reasons, not because of power and money (as a side note, eliminate any exemption from prosecution that any government employee or politician may have).

Re:Online transactions shouldn't be taxed period

[InnovATIONS]

Actually you are incorrect.

Sales tax is charged to and collected from the seller

The seller, if they wish, can (and often does) add the sales tax to their published prices and charge that to you.

However it is ultimately the seller, not the buyer, that has the legal obligation to pay the sales tax.

Note: This is at least the way the law is worded in California, and I am told that is also how it is worded elsewhere, but other states could be different

Re:Online transactions shouldn't be taxed period

[j-beda]

While it is worth examining where we spend our money, each one of the things you think of as being obviously wasteful is not so clear to me:

1. There is a lot of weight behind the idea that the NASA Apollo program lead directly to the microelectronics industry. Not such a bad thing to spend money on creating.

2. Fundamental physics research lead to the transistor - again a pretty good thing. Other examples exist.

3. Most politicians earn less while in office than when out of office, incidating that the pay of office holders is probably not that much too high.

4. There can often be "false savings" in going for the lowest price economy items. The limo might be more likely to get there on time and the taxi less so - this could potentially cost big bucks in trying to save a few pennies. Additionally, having competitive pay, having competitive "benifits" should help attract and maintain people capable of doing the job. 5. Some of the trappings of office reflect the importance we feel that office has. This type of psychological value has some financial cost which needs to be paid. If we want our leaders to look like leaders (and for the most part, we do), then it costs some money. 6. The tax system is complex because it is designed to serve many many ideals from revenu generation to wealth shifting to ecconomic encouragement and discouragement. Anything to replace it needs to examine all of these items and state how they might be addressed (or why they should not be addressed I suppose). A single tax addresses few of them. 7. The function of buildings extends beyond utilitarian ideals and can streatch into art and fancy stuff like that. People are happier in nice places at the very least which provides some ecconomic benifit to making places nice to work in or to visit. 8. A balanced budget at all times is not in the best interest of the country/state/city. Purely ecconomically, at times it makes sense to borrow to help things through the rough spots, and hopefully to pay that back and/or save when things are going well. Blanket policies can be disasters. 9. Mandated growth rates might not reflect the desires or needs of a changing society. What if we decide to go for some sort of national health care? Or get rid of the military? (Probably equally unlikely, but what the heck) 10. Some form of state campaign monies can level the playing field and allow for a wider possible choice of candidates. Preventing a slate of only the rich can be a good thing. 11. What constitutes a useless program is not widely agreed upon. People bitch and moan about SS and Medicare quite a lot, but both programs seem to actually do fairly well for what they were designed to do. From an ecconomic point of view, almost ANYTHING that moves money around has some benifits to people. Even make-work projects at the very least, make work. 12. Labour laws and union rules can provide for checks and balances against arbitrary firing and evil work conditions. This is a good thing. 13. The sex trade, even where legal, is rife with abuses and exploitation and linked to crime and other anti-social behaviour that society has an interest in discouraging. 14. The same with gambling. 15. The same with drugs. While I think that all of the above issues are worth examining and reexamining - none of them are clearly slam dunks (because if they were, they would have been dunked by now.) Government subsidies, prohibitions, and perks clearly can have unwanted costs, but they can and do also have clear benifits, which is generally why they were inacted in the first place.

Do we want to make governmental service so unrewarding that only saints and mental deficients want to persue it? How many saints will we attract? Would you (presumably an intelligent well informed wonderkid) want to go into civil service or politics if that did not offer a reasable wage/benifit package? Do we not want people like you to do that? Should society reward the president of Pepsi or the president of the USA more? How much more? Should we borrow money to build a road like we borrow money to buy a house or should we just live in a shack until we can save enough to buy outright? Should we invest in long term research and developement either directly or through the tax system or should we save our money? Should we discourage destrutive behaviour or should we let people do pretty much anything?

All of these are valuable questions - none of the answers are clear cut.

Re:Online transactions shouldn't be taxed period

[dh003i]

1. NASA may lead to the microelectronics industry, but why waste the overhead? Why not just spend directling on the microelectronics industry? Again, I couldn't care less if we could go to Mars or not. The race to land on the moon was nothing other than a feel-good propaganda race to beat the Russians and cost us billions.

2. Some fundamental physic research leads to transistors and other beneficial thing. I can imagine quantum phyics (quantum gravity, quantum mechanics, quantum thermodynamics) leading to great things for the US. But what will understanding how black holes operate lead to? I'll grant you it is part of human nature to want to know, and its good for us all; but that must be weighed against more important needs, and take a back seat to them.

3. Nevertheless, the greedy bastards vote every year to raise their own salary. They make more than 90% of US citizens, yet arguably most of them do less and in fact do harm. Refer to USA Patriot Act, DMCA, 1998 Mickey Mouse Copyright Extention Act, and so on and so forth. Where else in the world do you get to decide how much you're going to get paid? Someone else should decide their salary. Namely, it should be voted on.

4. I didn't say to go for the "lowest price" economy items. I said to go for the best overall value; that which will, all things considered, save us the most money. You're example with limosuines is absurd. Sorry, but a limousine won't get you from A to B any faster than a Chevy. There are speed limits.

5. The trappings of office are irrelevant. I don't want our leaders to look like leaders, I want them to be leaders. There's a difference. This psychological nonsense u talk about is just that. If someone can't understand that representing the people of their country as an elected official is important without getting millions of dollars worth of perks, they shouldn't be in office.

6. The problem with the tax system is that it is designed to encourage and discourage different things. This is bullshit and very expensive. It also creates tons and tons of loopholes for the rich to get through to avoid paying taxes. Furthermore, it adds to the complexity of the law; complex laws are always bad. Laws should be as simple and clear as possible. The money and time (and frustration) that one tax (an income tax) would save would be well worth the minor loss of ability to promote certain values. It costs billions of dollars just for the paper necessary tax forms; it costs billions to process them, due to their complexity; it costs billions to perform investigations. It also costs taxpayers money just by filling out the things, as it takes so long, or they have to pay lawyers. You shouldn't need to be a fucking master of calculus or even need a lawyer to do your taxes. You shouldn't even need to be smart. It should just be (Yearly income) * 0.x.

7. Public buildings are there to serve a purpose, not be artful. Since people are inside them most of the time, their appearance is rather irrelevant. Furthermore, intricate insides are also irrelevant, as people become accustomed to whatever they're surrounded by and aren't effected by it. The only purpose of it is to impress visitors. Bullshit, in other words. And how do you defend spending millions on a statue of Dr. Suess?

8. A balanced budget isn't always easy. It means prioritizing. But it is always beneficial, as you won't lose as much money due to interest.

9. Some cap on growth is necessary, or else the government will expand ad infinitum. The government has never shrunken in history. This is a problem.

10. State campaign monies only serve to help those in power get re-elected. Refer to Hillary Clinton using OUR money to run for Senator in NY. If you want more people to have the opportunity to get elected, push to modify the draconian ballot laws, which are designed to prevent any third party from getting on the ballot; this was conspired on by both the democrats and republicans.

11. The usefulness of many programs is controversial; however, some are universally or nearly so agreed to be useless. As for social security, it should be opt in. I can manage my money alot better than the government can; maybe some people can't, but I sure as hell can.

12. I'm not against labor laws and union laws. I even think of them as necessary (I'll return to this when I talk about legalized prostitution, for example). That does not mean that bad workers should be kept on board. Refer to the Rita Wilson case, where that child-molesting bitch was allowed to keep her job because of tenure.

13, 14, 15. Prostitution, gambling, and drugs. These industries aren't inherently evil and rife with abuses and exploitation. They're such right now because they are illegal and controlled by underground forces. If they were legalized, they would be regulated to do away with such abuses. More than a hundred years ago, the manual labor industry was inherently evil, abusive, and exploitative. Did we ban manual labor in assembly-line shops? No, we regulated to do away with abuses. The same is possible in prostitution, gambling, and drugs. I'll focus on prostitution. Yes, right now, there are abuses. People are tricked into prostitution, or forced into it; pimps abuse their prostitutes; prostitutes are raped; stds spread; and so on and so forth. However, were the industry legalized, all this could be regulated away, just as have abuses been regulated away in other industries. During the 30's, the alcohol industry exhibited the same flaws. Any industry which is illegalized will be rife with the problems you mentioned precisely because it is illegal.

The reason they haven't been slam dunked by now is because politicians are in it for themselves.

Yes, I do want a governmental service which is unrewarding. This way, only those who really want to make a difference (and don't want the power) will run for office. Rather than Ross Perots running for office, Lawrence Lessigs amd Karl Auerbachs would be running for office. Btw, people who really want to be in office are inherently bad people to have in office. (S)he who wants to be in power the least -- who absolutely abhors it -- will be best fit to be in power. I believe that was Socrates.

Re:Online transactions shouldn't be taxed period

[EmagGeek]

How many people can you find (anywhere) that want to be taxed online, so they have to pay online taxes in addition to shipping and handling? Has anyone asked the people about this, or even mentioned it in an election? No. My guess, 99.99% of the people in America don't want online taxation. So we shouldn't have it. Its called Democracy."

You must have forgotten that we live in a Republic, not a Democracy. The people have no real power whatsoever. Even if the people voted to repeal internet taxation, the politicians are under no obligation whatsoever to obey the vote. It's not really any different than a presidential election in which the Electors are under no obligation to cast their votes for the candidate that wins the popular election in a given state.

The *real* reason that internet taxation is wrong goes Way Way Back(TM) to our childhood in which we were usually taught that if we didn't have money to buy something, we couldn't buy it. The government has tried several ways to increase revenue.

First, during the Civil War, the government enacted the Bureau of Internal Revenue. This was a very small amount compared to excise taxes and tariff duties (the old way of doing it). The first self-expanding perpetual bureaucracy is born. Read more about the Civil War Bureau of Internal Revenue Here... And a way-way-cool tax history museum...

During the Johnson administration, the gubment took money off the gold standard and just printed as much as it needed to cover its spending programs. This ridiculous endeavor led to the hyper-inflation of the 70's and the 99.9% top incremental income tax bracket during the Carter administration, and the double-digit interest rates going into the 80's. It's amazing to me that the government didn't learn during this time that raising taxes does not increase revenue for the gubment - IT LOWERS IT because of the burden it places on the economy. People have less money to spend, so there are fewer sales, fewer profits, lower salaries, and LESS INCOME TO TAX. But, I digress...

Enter Reaganomics - now, whatever you learned in your left-wing democratic union-controlled public school about Reagan and his economic policies was blatantly incorrect. When Reagan took office in 1981, the government's purse had 18 bullet holes in it and was leaking money like a sieve. Our great country was spiraling almost inexorably toward bankruptcy, and we came very close to defaulting on a round or two of long term bonds. The fact is that after the gigantic tax cuts in the early 80's, IRS revenue INCREASED. That's right, cutting taxes INCREASED revenue for the government. *shock*

"but, but, but, what about the deficit?" - okay, the deficit was caused by Harry Truman. Yes, the deficit spending in the 80's was mainly due to the Truman Doctrine, which required the US to fight the spread of communism throughout the world. There was this little country east of Europe, called the Union of Soviet Socialist Republics, that had at some point in history developed nuclear, biological, and chemical weapons and was on the rampage. Since WWII, they had already installed their communist regimes in most of eastern Europe and were pushing west. The Arms Race was a very necessary evil, and as much as I hate to say it, we had to win the cold war no matter what. Combine that with an unchecked social welfare program that was often corrupt and abused, and we were suddenly saddled with mind boggling debt.

Here's a little perspective on the debt: if you were to pave a 12' wide road with one billion one dollar bills, you would have a road long enough to drive 252,000 miles, about the distance to the moon. If you were to pave a road with the national debt's worth of one dollar bills, you could drive 1.5 million miles. However, there isn't enough cotton on earth to make that many one dollar bills. (FYI all US currency bills are 6.14" x 2.61" and weigh approximately one gram per note, regardless of denomination).

The point here is in agreement with yours that the government is stupid when it comes to fiscal management. When their budget runs over, they just raise more taxes to pay for it. They don't care about the long term effects because there's no accountability. The worst that can happen is that they'll either get "voted" out of office or hit their term limit. But, nothing they do while in office will usually have a negative effect until they're long gone..

We need a balanced budget LAW, just just some sissy amendment that can be changed and re-written to suit the convenience of the politicians, but something that is irrevokable, unmodifiable, and carries the status of a high crime. IN fact, I can write it right now, and IANEAL:

"It shall be a high crime against the United States for any individual or group of individuals to cause a government agency to spend more money than it receives."

"It shall be a high crime against the United States for any individual or group of individuals to cause the amount of money a government agency receives to increase at an annual rate that is higher than the sum of the rate of inflation and the rate of growth of the Gross Domestic Product."

We owe it to ourselves (literally!) to pay down the national debt. Every bond you buy from the government represents money borrowed by the government, from you, to spend on $4000 toilet seats, private jets, politicians' vacations around the world, and let's not forget the $58,000 486 machines that the government is probably still buying.

Some other interesting government links:
The Bureau of Engraving and Printing
All About our Tax System
All About our Tax System, the government's version of the truth
The United States Mint
The Social "Security" Administration

Re:Online transactions shouldn't be taxed period

[anthony_dipierro]

Yes, they do just materialize out of nowhere if the customer is buying something like a software program which can then be sent online.

Really? You don't have any wires connecting to your house?

Re:Online transactions shouldn't be taxed period

[j-beda]

I did not mean to imply that my responses were complete rebuttals to your points, but rather that each of your points was not completely unassailable (sp?). Your counter points too have merit, but again, are not the last word on the issues, and neither are my responses herein. The point is that these are not simple problems, and policies to address them can and do have wide ranging and complex interactions and results.

1. and 2. The point is that basic research can and does lead to things that we do not know the possible use for until we get there. The microelectronics industry was not viewed as being a potential benifit, so we would not have invested heavily in creating it without the space program. In 1965 if you stood up in congress and said that you wanted 100 billion dollars to create a viable microelectronics industry, you would have got nowhere. Standing up and saying that we should go to the moon (before the evil USSR) managed to get the job done. So maybe we should find another cold war partner to dance with? Cut out basic research and it seems to me you cut out future inovations. Of course some other country will eventually do the figuring out and we can try to learn from them, so it isn't like the human race will wither and die...

3. In some sense it is voted on - we ellect the "bastards". Elect someone who's platform is based on reducing the pay rates and Bob's your uncle I suppose.

4. The limo is not faster, but you need not stand in line waiting for your turn like you do for the taxi stand at the airport. Finding out the best possible economy can be of value of course, but it is not a trivial proposition. One example would be the use of a travel agent vs buying the tickets yourself. A travel agent gnerally will charge a commission and may not be able to find the ultimate cheapest flight because they cannot possibly know all possible details of your life like your anut in Telsa who you wouldn't mind visiting on a 3 hour layover, but only if it is after her bingo game at 5. However looking over all possible flight arangements would probably take you four or five hours. Four or five hours might be worth a few hundred dollars savings to you personally, but is that type of "savings" worth it to the tax payer when balanced against the value of the job that the tax payer is paying a governmental worker to do? How much would it cost in time and resources to do complete cost-benifit analysis on all decisions of this type? For each and every case of "wasted" money in any organization, there is a non-zero cost associated with alanyzing how to best avoid such "waste". This doesn't mean that such analysis should not be done, but does indicate that there can be many cases where even the most "efficient" method can be less efficient than a more expensive method.

5. The psychology of leadership is not completely worthless. Even you and I with our great intelectual insight react differently to different people based in part on things that have little logical value. If your elected leader showed up in a dirty Metalica t-shirt to an important event, as much as I would like to say I would not be effected, I know it would have an impact. Given two people telling me that the new law on X was going to be implemented, I would react differently depending on my low level perception of the type of person they were, which would be infleuenced by how they appeared. I agree that there can be inappropriate levels of "perks", but I disagree with the idea that we can attract and retain competent people without offering them a competitive (or at least slightly competitive) benifits package. If you think that the current package is so out of wack with what it should be, why are you not trying to get such a job?

6. I think that this is a valid criticism of the tax system, but I do not think that you have properly examined all of the results of your proposal. Or if you have properly examined them, you are not shaving that insight when you say we should scrap everything and go with an ultra simple system. As only one single item amoung the billions to be considered let us look at donations to charities. Currently there is a tax advantage given when soneone donates money to someone like the Red Cross. While there aremany opinions about what sort of organizations should be considered charities, in general, most people do feel that charities are a good thing and can provide good things for society. If we eliminate the tax credit for such donations, there will be an effect on charitable giving. How much of an effect? Is this change worth the savings in complecxity? Should we enact some other change to offset it? Should we do something to help those served by charities if the charities can no longer function? As I said before, there is much merit to simplified tax codes, but there are also a lot of benifits to many of the "complications" of the current tax codes.

7. As I have stated previously, I think that there can be many areas (potentially the Suess statue, but I like Seuss :-) where there are inappropriate buildings, but I disagree with the idea that the least expensive option to build and maintain is neccessarily the best one to build. Peole work better in better enviornments, regardless of what we may or may not want. People do not want to work in drab blocks of concreete, and forcing them to do so is not going to help maintain moral, productivity, or employment - and we do have to attract workers to perform soem of the jobs of government and we do have to convince people to run for office. We probably do not need to have gold plated toilets, but it is probably a good idea to sweep the halls and wash the windows now and then. Somewhere between the two extremes is probably optimal.

8. A balanced budget is not always benificial. If that were the case, then one would expect to rarely see any family or business take out a loan. A loan can be a very useful ecconomic tool. One small example might be if a municipality borrows money to construct a convention center which then brings an increase in business which increases tax revenue which pays the interest on the loan. Or borrows money to fund a work study program which heps people get off social assistance and into the work-force and into paying taxes to incrase revenu. The idea that a balanced budget is somehow the ultimate in goals in all cases is just plain incorrect. This can be seen by just focusing on what might be meant by "budget" in the first place. Are we talking one year? Two years? One month? On different time scales it is impossible to always have a balanced budget. Of course, it is very important to have a sustainable budgetary system, and repeatedly running deficits is fiscally irresponsible and as you have pointed out interest payments can be killers. But the blanket prohibition against running a deficit is simplistic.

9. Growth does not and has not continued "ad infinititum". The USA has been around for a couple of hundred years and governmental growth has not choked us all to death yet. Looking at some older countries, we do not see any sort of problems that mandating a certain size of government would prevent, in my opinion.

10. I am not claiming that reforms would have no value, but rather that current systems do have some value. I do not know the specific laws in question, so perhaps I should conceed that you might have found a case where a simple solution is viable.

11. It is not the case that there are many programs that are universally or nearly so agreed to be useless, because if there were, then they would quickly get cut. As for social assistance type programs, you may not like being forced to be a part of it, but universiality is one of the strengths of such programs - a wide base of support is sometimes required for such a system. Incidentally, it is my understanding that SS is not a savings program, but rather a payment program where recipients get many generated from the people paying it. Thus, when it started, people immediately got money even though they had not been making payments previously. The projected problems with SS have been associated with the projected increases in the number of recipients compared to the number of payers. Granted, this might not have been the best way to set up the system (but at the time, it was pretty good since there were a lot more payers than recipients, and that was expected to be the normal state of affairs), but it actually seems to be working fairly well, and with the changes made over the past few years, does not seem to be in as much of a crisis as it was once though to be.

12. I would agree that there should be ways to remove those who are not doing their jobs, but some of the rules in place that retain such people might be rules that we son't really want to get rid of. Things like tenue can be compared a bit to things like freedom of speach - in order for freedom of speach to work the way we want it to work (allowing dissent) we have to also allow behaviour that we generally find offensive (things like racial slurs). Similarly, for tenue to work for what we want (ensuring academic freedom) we might also have to accept some level of undesired results (retention of some "deadwood"). This is not to say that such rules should not be examined, but rather to remind us that any changes must be carefully weighed.

13, 14, 15. Prostitution, gambling, and drugs. The areas where these are legal (Nevada, Amseterdam, etc.) do have problems with abuses and explaitation - this could be a result of how they are legalized, but it could also be more closely linked with the "vices" themselves. It is clear that human sexuality is a complex subject, and it should not be suprising that combining that with money has a high potential for undesired consequences. Drugs (including alcholol and tobacco) can and do have extream effects on significiant portions of the population and their mere consumption (regardless of the legality of their availability) can have significant effects on the individual as well as those immediataly surrounding adn society at large. Gambling also can be problamatical for a significant fraction of the population (from 1 to 5% of people are potentially "problem gamblers" according to published reports - which seems like a small number until you think that in a city of one million, this translates into over ten thousand people). Easy access to gambling for those problem gamblers can pose quite a strain on society. Again, I am not saying that the current methods of dealing with these problems are optimal, but I do maintain that blanket legalization is clearly not necessarily the ultimate soltion.

I think that there is a lot of merrit to your idea that we might be better served by those who do not want to be in office than by those clamouring for the position, but I have serious doubts that any of your proposals would move us in that direction.

Under the current state of affairs, we have so many many positions (judges, AG's, sheriffs, mayors, school boards, etc, etc, etc) that need to be filled that it seems necessary to me that we need to offer reasonable benifits in order to fill them. Cut the pay to the bare minimum for survival and no body who is qualified other than the independantly wealthy or perhaps the power mad, would ever run for office, at least in the numbers necessary. As stated before - are you running for office, even with what you think are unreasonably high rates of payment?

I have often looked with interest at systems like in Austrailia where people are required to vote and wonder if that might have any effect. I wonder if there is any way to have some sort of required governmental service or draft where rather than elect people who chose to run, we force people to take up office or the civil service. This type of idea is an interesting thought, but seems very unlikely to ever be able to be implemented - though I suppose if the military draft is constitutional a civil service draft would be equally so.

Re:Online transactions shouldn't be taxed period

[dh003i]

1, 2. This is true, we don't always know what basic research leads to. But we do often know what higher level, more applied research will lead to, so we should invest more in that, respectively.

3. There are alot of things we don't vote on because no politicians run on them. We're given a two-item menu, where most of the ingredients of both meals are identical. The DMCA was passed unanimously, as was the USAPA. The 1998 Copyright Extention Act was passed unanimously. Every single proposal for a pay raise was voted on unanimously; the only debate was about how much they could raise their own salaries without upsetting the people too much. These are things in which voters simply don't have a choice on, because the Democrats and Republicans have conspired to keep the names of 3rd parties and independents off the voting ballots.

4. The point regarding the limo is that they don't need a limo. A Volkswagon would do just as good, or almost any other car. If they think that its so important that they have a limo, they can pay for it with their own money, not ours. Btw, with today's computer age, its hard to see how they can't get things done while in a car.

5. I'm not saying politicians should dress in rags. However, they also need not spend OUR money buying themselves thousand dollar suits. If they want to buy the most expensive suits on the market, again, they can use their own money. If they want to rely on public money, then that should buy them respectable suits, nothing more. A $100 dollar suit looks fine.

6. The amount of money we'd save from not wasting resources on this complicated tax system would in and of itself more than counteract the losses due to not being able to promote as many different things. Btw, a one-tax system can still support charities; I've always thought that it would be good to allow people to subtract from their taxes the amount of money they spent on charities, and to decide what programs/services their taxes will go to support. The other reason why we should do away with this complicated tax system is that it is immoral on two counts. First, it makes it difficult if not impossible for many Americans to properly do their taxes without a lawyer. Second, its a way in which the government can regulate without consequence (refer to Lessig). Taxes are a shady way by which the government regulates that which would otherwise be unconstitutional to regulate, or widely criticized. Its a way to regulate without facing the consequences of regulation -- namely criticism. A bunch of Christians in the government don't like contraceptives and abortion; so rather than taking a public stand and pushing for their illegalization, (s)he immorally decides to raise taxes on those things behind people's backs.

7. Again, I'm not suggesting the least expensive option. But statues and what-not really don't do anything. People only notice them for the first few times they go somewhere, then ignore them. You can justify it with psychological arguments, but the reason its done is for self-important arrogant Gatsby's.

8. Its understandable that individuals can't always balance their budget. But the government has trillions of dollars to work with here. If they're running into money problems, that means they're spending too much. We give them more than enough money (ranging from 20 - 50% of our income).

9. Has the US government ever gotten smaller? Any agencies you know of that have dissappeared? Mandating that the government grow in proportion to our population growth is reasonable and feasible. Again, if that's a problem, they need to cut some of their programs.

10. The issue here is that government money goes towards helping those in power get re-elected, or elected. Refer to the Hillary Clinton issue where she ran for NY Senator using our tax dollars.

11. Most people don't know about the programs that are useless because they aren't doing anything. That's why there's no push to get rid of them. The programs and organizations themselves will do whatever it takes to stay alive.

12. Rigid rules preventing the firing of an employee are absurd, which is what tenure amounts to. I'll focus on a specific case here, that of Rita Wilson. She asked girls to lift their skirts and prove to her they weren't wearing thongs before letting them into a school dance; when some refused, she forcibly pulled them up. This is a violations of several laws (illegal search/seizure, violation of privacy, sexual harassment, sexual assault) as well as the CA Educational Code, which forbids the rearrangement of clothing around the private areas to examine underclothes. She should have been fired and put in jail; yet, she was only "demoted" from Vice Principal to teacher, putting her in closer contact with the students she violated.

13, 14, 15. Prostitution, gambling, and drugs. People are responsible for their own actions. If someone has a drug problem or a gambling problem, that's their issue. Also, I didn't say there should be no regulation; people shouldn't be allowed to walk around doing LSD in a public park, or be high in a public place. Same thing for prostitution.

Focusing on prostitution, yes there are abuses and problems that come with it (marital issues, stds). But there are abuses and problems in every industry. There is nothing intrinsically wrong with prostitution. Its a (wo)man's body, it should be his or her choice whether or not to sell it for money. No one is necessarily getting hurt, and its an activity between two consenting adults. The objections to it focus around misplaced concerns, such as (a) "its indignifying to women", (b) "its immoral", (c) "it spreads stds", and it (d) "promotes marital infidelity.

(a) Indignant to women. The feminist argument. What's insulting to women is when some feminist elitists have some idea of what "feminism" is and then want to use that to deny all other women the right to choose how to run their own life. Also, how exactly is it indignant? Because women may not want to do it? Well, there are alot of things that we don't want to do but do to survive; for example, being a janitor. Prostitution (like Stripping) offers an alternative to women and men which is higher paying. I don't see that as demeaning, I see it as giving them a choice. Maybe some think its insulting to women, but in that case, don't do it. If you don't like it, don't do it; if someone else does, or is neutral, they might. The actions of one woman in no way reflect upon another woman. Btw, elitist feminists will be interested to note that there is a whole class of feminists out there who think that Stripping and Prostitution (broadly referred to as "Sex Work") is empowering to women.

(b) Its immoral. The Christian argument. Really? I thought that blowing up abortion clinics was immoral. I thought molesting little boys was immoral. Certain people may find prostitution immoral; in that case, they shouldn't do it. This is a free country, and no-one has to believe in this tyrannical god which forbids all things pleasureable. There are many things to be said for the benefits of prostitution. Of all the things you can do to someone, giving them an orgasm is hardly the worst. In the army, you get a medal (and paycheck) for spraying napalm on people; in civillian life, you go to jail for giving someone and orgasm for a few bucks. Hardly makes sense.

(c) It spreads stds. Which is exactly why protection should be mandated in legally sanctioned brothels, and why women who'd be licensed to be prostitutes would be expected to use condoms. Similarly, regular std testing would be mandated. Also, one should note that it can only spread stds to willing participants, or their partners (who are willing with them). Again, people are responsible for their own actions. Unprotected sex also spreads stds, but we don't illegalize that between people who aren't married.

(d) Promotes marital infidelity. Well, this isn't the fault of the prostitute, or the industry. This is the fault of the married couple, where one of them is cheating on the other. Its not the government's job to babysit people and ensure that their marriage works out. If infidelity is a problem in a marriage, then there's a problem with the marriage itself -- not with the prostitue who's the unknowing outlet for a (wo)man's infidelity.

Final thought. Irrelevant of the arguments against it, none of them are strong enough or direct enough to ban prostitution on solid ground. Murder and rape harms people in obvious and direct ways, hence they are illegal. But the effects of prostitution are indirect and highly variable; no one is necessarily hurt from prostitution, as people are necessarily hurt when murder or rape occurs. There is no justification for violating someone's right to body by preventing them from becoming a prostitute.

Re:Online transactions shouldn't be taxed period

[j-beda]

I can easily see validity to most of your points, though I (as before) question many of your conculsions. In my opinion, you are being overly simplistic with most of your solutions to what are generally complex issues.

Yes there are abuses of many of our systems. I contend that many of those "loopholes" are the result of design choices necessary to achive some of our societal goals.

Unfortunately, the system we have is not designed to let you or I decide these types of issues, but rather to try to get "the public" by way of elected politicians to create laws, institutions, and practices. Against the wishes and desires of various large bodies of the population, it is unlikely in the extreme that any of your proposals would find sufficient support to be enacted. One possible explination is that everyone else is deluded, but perhaps many just do not share your desires.

Personally, I think that for the most part, the "western world" is doing a pretty good job. Our leaders have a lot of perks, but compared to other times and places, they are much closer to the "commoner" than they might be. The abuses in our systems should be addressed, but they are much less than they might be. I happen to support many limits of our "freedoms" in the way of regulation of businesses and in our regulation of "vices", and in fact feel that in some areas we should be tightening up (don't get me started about state sponsored lotteries as a way of raising finances!)/

I worry a lot about the programs and protections offered to workers, researchers, the poor, etc. and am very cautious when examining policy changes that might impact those programs and protections. Crafting rules that would let you easly dismiss your skirt-raiser while still protecting my whistle-blower is not as easy as you seem to be implying.

Re:Online transactions shouldn't be taxed period

[corey_lawson]

...but those wires are already taxed for their alleged impact on the government! Look at your phone bill some time!

Re:Online transactions shouldn't be taxed period

[corey_lawson]

Einstein, Bohr, Heisenberg, et al., the initial brains of quantum mechanics, were all theoretical physicists...

Re:Online transactions shouldn't be taxed period

[anthony_dipierro]

Yeah... So are warehouses and factories already taxed...

Oxymoronic

[lildogie]

"Projected Sales-Tax-Revenue Losses in 2006" heads the chart in the Denver Post article.

A "Revenue Loss." What a crock.

Woah, woah -- WOAH!

[Inoshiro]

"The US doesn't _need_ tarrifs, which is why it doesn't have any. "

That is a bald-faced lie (you might also want to find out what the US is doing in regards to steel, it's the same back-stabbing).

The US government is very happy to force tarrifs, taxes, etc, on imports. They don't like it when an unrefined resource producing country like Canada has a competitive advantage, even though it makes more sense economically for both parties (as you pointed out: the US gets the resources it wants, Canada gets the refined goods it wants, companies make the money they want).

If you wonder why this situation exists, it is because the US government continues to pander to special interest groups. Why do they do this? Because, as the most recent election showed, voting for a republocrat is throwing away your vote -- only a few people, the special interest groups, get to decide the entire fate of the country.

Re:Woah, woah -- WOAH!

[SirSlud]

Ah well, any was a bad choice in words.

Few. I'm aware of the softwood tarrif, and Hollywood lobbying for entertainment industry subsidies, etc .. but these are exceptions.

My point was still that _when_ they impose tarrifs, they look pretty hypocritical, and for the good reasons you list.

Re:Great idea: Make things harder for online bidne

[yog]

"Can you really justify not giving the poor people of California, Massachusetts, and Virginia the food stamps and Section 8 housing checks they so richly deserve?"

Tongue in cheek here, methinks. Yet, the states are approaching this with a completely straight face; they would say you are exactly right. Having squandered their huge surpluses during the boom years on pork barrel spending, they are now looking to save their own jobs by attacking a sector that has no political voice in their locale.

Most online merchants are not profitable, investors have stopped buying their stock, and the economy is in recession. It's both stupid and crazy to levy new taxes right now, and unfortunately it's all too likely to pass, if the Demos can get their way. Of course they'll then find a way to blame the resulting destruction of tech businesses and related tech infrastructure companies on GW Bush.

It's called Use Tax

[leinhos]

At the risk of being redundant, many states have "use taxes" on the books to cover this. If I cross state borders to another state that has a lower sales tax rate than my home state, use tax laws require me to declare the item and pay sales tax (or the balance of the difference) to my home state. This is the case for anything purchased over the phone/internet/mail. The problem is that this kind of tax law is impractical to enforce, so the money hungry state governments are looking for ways to get thier piece of the action.

What's really funny about this is the "paper loss" mentality many people have about this kind of commerce. From the article:

Colorado is projected to lose $686.4 million in revenue in 2006 if it does not tax interstate e-commerce, according to a study released last year by the University of Tennessee for the Institute for State Studies.

The article should read "Colorado is projected to gain $686.4 million in additional revenue in 2006 if it finds a way to enforce existing tax law regarding interstate [e-]commerce ..."

Simply because they estimate a dollar amount leaving the state doesn't mean that the money can magically be had for additional government spending. Once they find a way to do this, the e-conomy will adapt accordingly.

I'd be afraid for my wallet if they actually do figure out a way to do this, because it would be an additional incentive for states to have a higher tax rates relative to thier neighbors. If state A has lower use taxes than state B, then it won't get any additional revenue from its citizens buying out-of-state products. Even better (the constitution be damned), they could start setting up checkpoints at the state borders.

Re:It's called Use Tax

[anthony_dipierro]

Even better (the constitution be damned), they could start setting up checkpoints at the state borders.

Umm, what's unconstitutional about setting up checkpoints at the state borders? It's not exactly cost effective, especially when you consider the value of the people's time who are being stopped, but unconstitutional?

Why is this made so complicated?

[lucifuge31337]

If one were to use the brick-and-mortar metaphor for buying online/from a catalog:
You buy something online/by phone/etc from a company with no physical presence in your state. Let's make this simple and equitable and say that the transaction takes place AT THE RETAILER, which is a fairly logical argument to make.

So the business charges you THEIR local sales tax, as if you drove there and bought it in their state. It's simple, as businesses won't have to register with each state and handle reporting information for 50 states worth of sales tax (no easy chore for even ONE state....trust me), and states which have chosen not to double tax people to death (read: Delaware) will become the mail-order reailer hotspot (not just everybody's paper corperate HQ).

Oh....nevermind. The states who are useless as locations for mail order companies (the ones who's citizens use mail order the most due to their lack of infrastructure/proximity to cities/etc.) want to grab money that isn't rightfully theirs. I guess I should have though out this post better.

Why, exactly shouldn't online retailers be taxed

[KilroyTheVeg]

If you read the article it states:
(quote)"Online companies don't use state services," he said. "If you're going to the store to buy something, you're going to be driving on the roads and the store will be using police protection or fire protection and other state services for which it would be appropriate that they charge a tax."(endquote)

And theoretically the consumer "never" legally gets out of paying sales tax as most states have a "Use" tax equal to the sales tax. But of course everyone scoffs at the use tax and don't pay.

Internet Retailers already pay taxes...

[silverhalide]

Two things about this bother me. First of all, these provisions are only addressing "Internet" stores. This leaves traditional phone-in mail order services exempt from sales tax (as they currently are as well). I'm seeing a huge loop-hole here. Place your order online, call a number, press a button to confirm your order, and all of a sudden it's not an internet sale anymore. Tax free!

Second, this is simply unfair to mail order companies in general. Having worked for one the better part of my life, I see the costs that go into such a business. Not only does the warehouse pay all of its traditional taxes -- property, employee taxes, and whatever else you have, they have several high expenses on top of their costs. Since accepting cash is not practical, they pay an additional 3-4% of EVERY DOLLAR that passes to them in credit card fees. I'm not sure exactly how the credit card companies pay their taxes, but I'm certain they do. Also, you have shipping fees on top of all that, in two places -- receiving product and sending out product. These shipping companies are definitely taxed -- the gas they use in their trucks, the employees, their infrastructure, everything. So, point being, a mail order business of any kind, internet or not, is already paying 10-15% of its goods' value in various expenses that directly translate into a tax revenue at some point for governments.

Adding yet another tax on these companies will certainly make them struggle, reduce sales, and greatly affect revenues collected from the other sources. And since online merchants margins are generally very low, we're talking less than 10% in some cases, this extra burden could very easy put a lot of them out of business. Now, we can't tax someone who's out of business, now can we?

The government should be supporting commerce, not stifling it with extra taxes that really don't have any return value for the merchant. How is paying 5% to a box I ship to colorado from florida going to benefit me? It can't! At least local sales taxes have a direct, tangible effect on our daily lives, which makes them somewhat tolerable.

Re:Internet Retailers already pay taxes...

[Anonymous Coward]

So, point being, a mail order business of any kind, internet or not, is already paying 10-15% of its goods' value in various expenses that directly translate into a tax revenue at some point for governments.

All business do that, internet or not. They pay most of their revenue out as expensese, and almost all of those expenses are taxed. Just because it's credit card fees instead of property tax on a retail presence doesn't mean it's any less tax. Physical stores have to pay sales tax, while internet stores don't.

Re:Internet Retailers already pay taxes...

[nizo]

These shipping companies are definitely taxed -- the gas they use in their trucks, the employees, their infrastructure, everything

Time to bring UPS, FedEX, and heck even the USPS (they are an indie company now right?) into the fray, just imagine how much business they will lose if internet sales tank.

a worthy cause

[mboedick]

States plan to use the extra revenue to try and buy Slashdot editors a copy of Strunk and White, so they're grammar will be better then it is now.

Re:a worthy cause

[pjgeer]

States plan to use the extra revenue to try and buy Slashdot editors a copy of Strunk and White, so they're grammar will be better then it is now.

Why don't you try clicking your own link, Mr. Garrison?

Re:a worthy cause

[mboedick]

Why don't you try clicking your own link, Mr. Garrison?

uh that was kind of the joke.

People allocating their tax dollars

[GuyMannDude]

Of course, I'm fundamentally against "general" taxation and believe that our tax forms should include an itemized list that we can select to spend our portion of the tax we paid on. That way programs that were universally dislike would disappear quickly, programs that just a few people liked could be supported somewhat, but very popular programs would get even more money. I'm also against Social Security and Medicare. Mostly because I'll never collect SocSec, and even when my wife and I were both unemployed we didn't qualify for Medicare and as a consequence have large amounts of medical bills. So I'm paying all of this money out into services I will never see a return from, and a good 40% of my tax money gets taken to fund a military industrial complex that I don't support!

I can't believe I'm reading this! Suppose 99% of the population decided they don't want their tax money going to support unemployment benefits. Boy, you and the misses would have been SOL then. Then there's your wonderful "I don't want my money going for national defense." I suppose you still expect the evil military to defend you even though you have elected to withold all your tax dollars from them. If you don't want to pay for the military then I don't see why they should provide you, personally, any protection. If Osama appears on Al-Jezzera and states "On October 29, 2002, the holy warriors of Al-Queda will attack and destroy the house of Kintanon, Allah be blessed, Allah be praised. We swear to Allah that no one else will be harmed." then I think the military that you refused to pay (with your taxes) ought to just sit by and let it happen. I'm guessing you probably feel differently...

I'd hate to see exactly how the masses decided to allocate their tax dollars if it was up to them. Especially since very few people have the background in economics to realize the full implication of their choices.

GMD

Re:People allocating their tax dollars

[Kintanon]

Oooh, too bad you're a moron...
Even when we were both unemployed I was NOT ELLIGIBLE for unemployment because of the way my previous employer had been paying me, and because I had only been in the state for 8 months or so.
And no, I don't expect the military to defend me. They don't currently offer me any personal protection, any more than the worthless police force that my tax dollars also pay for. The US military is a tool used by politicians to generate wealth in their homestates through massive spending and to intimidate other countries into compliance. They are not obliged to protect me personally from harm and I don't expect them to. I take personal responsibility for myself and I will defend myself and my friends and family just as they will defend me.

Kintanon

Re:People allocating their tax dollars

[Anonymous Coward]

Ooh, too bad you're an asshole. You ARE benefitting from the taxes spent by others, in your roads, your schools, in the environmental restrictions that give you breathable air and drinkable water, in the farm bills that keep food available, in the police/jails that keep murderers from killing you and thieves from stealing from you, etc. That doesn't change just because you don't think they're doing a good enough job...because they're still doing the job, and even if they hate you they're still doing the job for everyone else, to your very immediate and personal benefit. Unless you think all that gets magically taken care of all by itself? Unless you expect the rest of the country to live in poverty just because you yourself want to?

Re:People allocating their tax dollars

[yog]

You call that person a moron and then you go on to espouse this tribal mentality. Rather intolerant, aren't we now. Fine, so move to a nice little tribal society, perhaps in some part of Africa, and stick your head in the sand and the rest of us won't have to carry the burden of defending your right to speak freely. You'll be happier too. Meanwhile, the rest of us can get on with the business of living in the modern world and, perhaps, attempting to improve it a bit.

Re:People allocating their tax dollars

[Kintanon]

Did I say anything against roads? Did I say anything against environmental protections? No. I speak out against the MASSIVELY overfunded military, and the woefully ineffective police force. The job of the police is not to protect us, but to punish criminals and clean up the mess afterwards. If a cop sees you being stabbed to death on the sidewalk he is not legally obligated to help you. His job is only to arrest the guy stabbing you.

Kintanon

Re:People allocating their tax dollars

[Kintanon]

Yeah, that's right, 'cause building a fucking HUGE military and propping up small dictators so you can knock them down later when they turn on you is REALLY making life better for everyone!
Massive centralization of power is not an improvement over localized self government. Some ignorant jackass in washington, or california, or canada, or sweden is going to be even less effective than an ignorant jackass who lives in the area when it comes to making decisions about the area. Devoting 30% of your national budget to building more weapons is not good.

Kintanon

Oh Brother What is Up with Them Now

[kenp2002]

They Said:
Monday, October 28, 2002 - Tax-free Internet purchases could be dot-gone within a year or two as states search for ways to lower budget deficits
I Say:
Has it ever occurred to them to curb spending?
They Said:
Colorado is projected to lose $686.4 million in revenue in 2006 if it does not tax interstate e-commerce, according to a study released last year by the University of Tennessee for the Institute for State Studies.
I say:
Most families don't spend more than they earn, why don't "They" quit spending money they don't have?
They Say:
The report estimates that all 50 states could collectively lose more than $45 billion in Internet sales tax revenue in 2006.
I say:
You can't lose what you didn't have in the first place. It isn't their money it's OUR MONEY!
They Say:
The Streamlined Sales Tax proposal, on which delegates from the 29 states will vote on Nov. 13 in Chicago, would simplify tax collection procedures.
I say:
The US Constitution is around 10 pages long. The US tax laws total over 2 million pages. You cannot simplify the beast by adding MORE laws.
They Say:
"It's my hope that we reach that level next year," said project committee member Bruce Johnson, who is a Utah tax commissioner.
I say:
There is a man with few friends.
They say:
Gov. Bill Owens, who has put high-tech development at the top of his agenda since taking office in 1999, firmly opposes any sales tax on the Internet

"He feels it's really taxation without representation," said Dan Hopkins, a spokesman for the Republican governor.
I say:
There's someone to vote for!
They say:
Democratic businessman Rollie Heath, Owens' challenger in November's gubernatorial election, is pushing for Colorado to join the tax project.
I say:
This is why I will NEVER VOTE DEMOCRATE. All they want to do is STEAL my money and spend it on things I don't want. They're Socialists now, quit calling them Democrats.
They say:
If Colorado joins the project, the state would have to make significant changes to its tax procedures.
I say:
See the earlier comment on the 2 million pages of tax law!
They say:
But states have the authority to tax sales from online vendors who have a physical presence in their jurisdictions.
I say:
Pass the laws and watch them move their servers to Non-US locations. That will mean more money flowing out of the US economy.
They say:
In Colorado, if a company maintains an office or warehouse in the state or regularly sends a sales staff here, it has a physical presence.
States don't have the authority to tax sales from online companies who don't have a physical presence in the state.
I say:
Ok, I have a warehouse in CA, Offices in NY, and my servers in MN. Who gets to tax me?
They say:
But even when an online sale isn't subject to a levy, Colorado law requires residents to pay a use tax on the purchase.
Few are aware of this requirement.
I say:
Democracy is rule by the people. If the people don't know about the law, how legitimate can the law be without the support of the people?
They say:
But the consumer still must pay use taxes, he said.
I say:
Remember your citizens are armed Big Brother, and there will be a point we won't take it anymore. We rebelled once against taxes, and overthrew an invincible power, and we can do it again. Don't push you luck. Be thankful we vote you out of office for pulling shit like this.

Re:Oh Brother What is Up with Them Now

[verloren]

I will NEVER VOTE DEMOCRATE. All they want to do is STEAL my money and spend it on things I don't want.

Unfortunately that's all the Republicans want to do as well. They campaign on lower taxes and smaller government, which may well be A Good Thing (TM), but it's a good thing you can only sell once ("yes, I know you lowered income tax last year, but what do I get this year?"). So to keep themselves in jobs they have to keep doing stuff, and stuff costs money.

Re:Oh Brother What is Up with Them Now

[bryan1945]

At least they cut income taxes. Now they want to make them permanent (currently they expire in 10 years). That's stuff I go for.

As for doing stuff, I pretty much oppose any gov spending increases, Dem or Rep, so at least they lowered my taxes.

Sorry about the formatting but...

[kenp2002]

-Begin Extended SiG for the Sake of Technology Please Ignore when moderating and reading-
P.S. Damn what is with the Lameness and text per line filter now. I tried 30 times to post. I had to strip out all the blank lines just to get the post done. Is this a recent feature change? I cannot space a post with any logical grouping with this feature. This is a bizzare form of censorship if you ask me. Only Big Chunks of hard to read text please. Oh no don't format anything so it's easy to read just clump it all together. Utterly useless.

Globalization and taxes.

[Mitreya]

For more than one large store chain (such as Staples) this is no longer an issue.

I was recently ordering from them and with my tax there was an explanation that basically stated that: Since they have a *presence* in 48 states (excluding Havaii and Alaska), I will be taxed no matter what (unless I actually live in Havaii/Alaska).

So states are probably not missing *all* the revenues from online busnesses...

What!? Some people are not entirely miserable?!

[Fantastic Lad]

Well, who fell asleep at that switch! We should ship him/her to the South to be put down like the dogs they are! (And make up for all the lost 'misery revenue').

Seriously. . . I've read today more childish arguments from people who are basically saying, "Well, if I have to pay tax, then so should everybody!" --Which stems in part from the barely legitimate fear of losing the precarious toe-hold on their own income through a Bricks & Mortar business, which won't happen unless they are nincompoops who don't know how to run a business in the first place, (Why not set up your own internet order department and get one of your clerks to manage it? DUH!), and from a rabid sense of unfairness which has precisely nothing to do with what is good for the nation and everything about, "MOMMM! BILLY GOT MORE ICE CREAM THAN ME!!!"

As for more new & wonderful taxes. . .

Bullshit. Greed and nothing else. For one thing, the economy is mostly a make-believe game anyway, and for another, if you want to live in the 'good little consumer' head-space and play the make-believe 3rd edition rules to the letter, well then if the government would just, say, tax Microsoft properly, punish corporate criminals, (like Bush), and stop plans to drop a billion dollars worth of bombs on Iraq every week, then MAYBE we could dispense with all this other nonsense.

Internet Tax? Fuck off. When the net is taxed, it'll also be so tightly controled that a pipsqueek like me won't be able to speak his mind. And wouldn't that just make for a bad day?

-Fantastic Lad

P.S. Is it just me, or has Slashdot been particularly 'careful' these days to steer clear of political and social topics which actually 'matter'? I've asked it before and been modded to shit for it, but I'll keep on asking until my Karma is dead and gone. . . "Who is whispering into the ears of the Slashdot Editorial staff these days?" I notice the story about the story about implantable microchips broke several days ago and hasn't shown up here. . . Hmm.

How about reading the article first?

[Anonymous Coward]

It's strange that you can manage to find the appropriate clause in the Constitution, but you can't manage to actually read the original article:

"The end game is to go to Congress and say 'We have now simplified this enough so that it's no longer an inappropriate burden on interstate commerce and we would like you to tell retailers that they have to collect sales tax for states who have joined the agreement,"' he said.

So, Congress will still be fulfilling its constitutional duty.

Re:How about reading the article first?

[buzzcutbuddha]

All fine and good except for the fact that the Constitution states in Article 1, Section 9 that taxes are not to be levied against goods "exported" from the States. Essentially any goods sold from an entity in one State to an entity in another State is tax-exempt.

States can't make an end-run around this just because they lose money.

For them to try and force this taxation would be tantamount to several States getting together and saying "We know the Bill of Rights protects the right to Free Speech, but we don't like that and want Congress to enforce our newly-passed restrictions on speech." Just because a State wants it and passes a law to that effect, doesn't make it right, legal, or binding.

Point is...

[unicorn]

If they use virtually no local resources, why is it they should pay local taxes of any sort?

Re:Point is...

[j-beda]

If they use virtually no local resources, why is it they should pay local taxes of any sort?

Retailers do not pay sales taxes, the customers do. The customers live, work, and play in the region, and thus do use and benifit and have representation for local resources.

Currently the customers legally HAVE to pay use taxes for stuff bought from outside the local region. These types of proposals are just ways to making it easier to actually collect such taxes.

Imagine a very simple world, with only one local retailer and one out-of-state retailer. Assuming that you are going to impose a sales tax, does it make any sense to only impose it on the local retailer? The local business can't compete and goes bankrupt, and everyone is still happy because they can buy from the out-of-state place. Only now there is no local tax basis at all, so the roads and buildings and fire services have to be cut. Where is the logic in that? It makes more sense to tax only the out-of-state purchases, but people relized that this type of protectionism wasn't desired so they made that illegal to do under inter-state-commerce legislation. But taxing all purchases equally is surely a fair system.

Re:Point is...

[Anonymous Coward]

If they use virtually no local resources, why is it they should pay local taxes of any sort?

If they used local resources then there would be no reason to tax them in the first place. They could just charge for the resources directly.

VATs

[Anonymous Coward]

The European concept of VATs takes care of this but it rubs against the grain of most Americans. The tax code in the US is way too complicated already and the government would find a more efficient way of taxing to be more profitable in the long run.

Everyone is down on lawyers, but it's tax accountants that chap my hide. I hate the fact that compliance with the law and only pay my share almost requires me to pay someone else for assistance.

Dont they ever learn this isnt how it works?

[nurb432]

Basic economics.. higher taxes = less money to spend, thus lower overall tax revenue..

Here in my state they are pulling the stunt of raising sales tax an additional 1% because tax revenue is low. Just in time to ruin the shopping season. ( oh and after voting themselves a pay raise, and better insurance benefits.. but canceling all non-political state workers raises for the next 2 years because of the poor revenue )

Will they ever realize that lower taxes is what stimulates the economy? Or do they just have to take it all and keep the populace down until the next, WAY overdue revolution happens when everyone has had enough.

Re:Dont they ever learn this isnt how it works?

[anthony_dipierro]

Basic economics.. higher taxes = less money to spend, thus lower overall tax revenue..

Yeah, they should lower the taxes to 0%, then they'll maximise their revenues! Umm....

My family is moving to your town!

[DAldredge]

If the local cops have the time on the weekends to check garage sale perments NOTHING else illegal must be going on. You must live in the safest town in the country!

Here's that well-reasoned argument...

[Spock the Baptist]

"Can anyone put forward a well-reasoned argument why the Internet should be exempt to sales tax?"

The complexity of current systems of sales tax in the US are so complex that only larger retailers would be able to justify the use of online sales. Smaller retailers would be forced out of the market. In the event of some sort of simplified "internet tax" system, there still is the problem of submitting the taxes to the various states, no small headache.

Because, many of the most interesting, innovative, and creative products offered online are from small businesses, including mom & pop internet retailers, those products would disappear from the internet in the event of internet taxation of the sort mention in the original post.

An example:
I'm very into bass fishing. Fisherman often develop a preference for certain lures that have become their favorites. New lures are introduced to the market, and become the hot bait of that year, season, etc.. It's not uncommon that the new hot lure, or an old favorite will not be available from local tackle shops. Local tackle shops have limited space, indeed even the biggest names in the mail order fishing tackle such as Bass Pro Shops, and Cabela's don't have the space to carry ever model, of lure, in every size, and color. (1k of models, 10 different colors on average, and lets say 5 sizes on average yields 50,000 different lures, and this is a conservative estimate.) Thus, I have on many occasions ordered lures direct from small manufactures, though, I prefer to do business with local tackle shops. Often these manufactures are ran out of a garage, or the shed in the back 40. As such they are quite capable of selling online to anyone in the US give the current tax structure. However, if these small manufactures were to be subjected to the complexity of having to determine, charge, and submit sales taxes to umpteen different taxing authorities in 50 different states the paperwork would overwhelm them. Even under a simplified system they would still have to submit taxes to 50 different states. Thus, in either case they would then only be able to sell wholesale, and/or retail only within their local taxation district.

Not being able to sell to the fisherman directly would deprive such companies of the ability to be profitable, and the consumer of a broader choice of merchandise.

Ergo, the consumer is harmed, and both local economies, and the national economy is diminished.

I would also point out that catalog sales have always been "tax free" as the purchaser was responsible for state, and local taxes. So this sort of tax "problem" has been around for quite a while. I've been ordering from Bass Pro Shops, Cabela's, L.L. Bean etc. since at least 1976. I clearly recall that in the early 80's there were calls for taxing catalog sales. Such calls occurred with a fair amount of frequency for 15 years, or more. With the advent of the internet such calls morphed from "tax catalog sales" to "tax internet sales." This whole thing is nothing new, not unlike the push to prevent music, and video coping. First it was cassette decks, then VCRs, and now it's mp3 etc.. Same song, somewhat different lyrics.

Re:Here's that well-reasoned argument...

[Anonymous Coward]

What we need is to consolidate the many taxes we pay in one place. For example, Connecticut has both state sales and income taxes as well as local property taxes. All of these taxes should be consolidated in one simple, fair, efficient way. Sales tax is ridiculous - require people to account for a nickel here, five dollars there, etc. It would be far better to file one annual income tax return. From the user's point of view, salary information is already available - copy a number off your 1040. The state (and local community) can then decide an apropriate progressive rate structure based on income. This should be more efficient (one-time billing, not a thousand separate sums), fairer (easier to make a progressive rate structure), and simpler (everyone remembers their W-2s - who actually keeps receipts for "use tax"?).

Re:Here's that well-reasoned argument...

[dperkins]

Not only is harmful to the mom and pop shops to have to submit tax information (and collections) to the 50 different states, but once there is a precedent for the states getting revenue from online sales the municipalities are going to want in on the action. Government never saw a tax it didn't like. It has also never liked not being able to get in on a tax that others are getting. Odds are that as soon as the states are able to tax Internet commerce, the cities are going to start trying to figure out how they can get "their fair share" of the pie.

The problem with net taxation...

[Traicovn]

*stands on soap box and prepares to shield himself from tomatoes*

I think that taxation of goods on the net is a good thing. I think we need it. Now, let me explain why.
If you buy a good or service on the net there is no tax (usually) that you are forced to pay. Yes, you do end up paying the equivalent of or possibly even more than the cost of tax in shipping.
The biggest problem with taxing products on the internet is the number of tax zones that there are in the US. I forget the number, but it's not 50. It gets down to the county, and then to the city, and then finally down to the actual product sometimes (it is not uncommon for food, or prepared food, to have a different rate of income tax, or for their to be an extra penny tax on certain goods). The problem is with all of these tax zones and the diversity of locations where shoppers and businesses are located is that keeping track of this data tends to be a pain, plus it means that while one person from Maryland may have to pay 30.00 for a product plus 5% tax, the person buying it from Florida might have to pay 7%.
Enter the net tax: What I WOULD be willing to support is a broad, internet-wide sales tax, say, all products bought on the internet have a set tax rate of 4% (or 6%) but something low. This would be divided in some way where each entity (city, county, state) from both the region where the buyer and the region where the seller are located.
Here's WHY I would be willing to support a sales tax on tangebile goods bought on the internet. Think of where that money from sales tax goes. Yes, some of it does go into silly programs, and into the pockets of city and state officials, but most sales tax money is used for programs such as education, fire departments, and other local services that you may use on a daily basis and not even think of. In reality your local city government provides more services to you, and effects you more than the national government in most situations.

I do however REFUSE to support any tax on things such as access, hosting, online payment systems, or other SERVICE related items on the internet. I am STRONGLY against any sort of 'internet access' tax.

In closing, let me say that before you speak violently out against taxes, think about what it would be like without them. Think about how much money could be lost to your city and state if more and more people start purchasing things online, maybe even purchasing online and then being able to pick up at a local retailer. Yes, I hate paying taxes just as much as the next person, I'd like to be able to hold onto as much of my money as I can, but I also am able to see the money being used in the community around me. As long as I can still see that the money is being put to good use, I feel that I can support taxation. If placing a tax on goods purchased on the internet means that I can continue to see this money being used in the community around me and in education, then yes, I'll support it. But in closing, they have to make it easy, if the tax is not just a 'general' tax that you are required to pay (a nation-wide tax that is divided between the different state/local governments) then it will end up being even more of a pain in the neck.

Re:The problem with net taxation...

[Traicovn]

By the way, that number of tax locations (according to the article) was 7,500. That probably doesn't figure in a local areas different tax rates on different goods however (i.e. perhaps an extra tax on espresso)

We're all guilty of tax evasion

[Shalda]

Most states that carry a sales tax require you to report and pay tax on all untaxed sales from out of state exceeding a certain dollar amount. So if you've ever bought a computer over the net, you've most likely met the threshold and could be guilty of tax evasion if you didn't report the purchase and pay tax on it. Since this is all on the honor system and there's no means to track it, states see only a negligable income from this.

Not only do you have to contend with different rates for different localities, but you have to mess with different exemptions and ways of classifying products for tax purposes

This is why out of state taxes have to this point not been forced on sellers. Also, states lack jurisdiction to force outstate merchants to report taxes. Sales tax is always linked to the buyer because taxing the seller would put them at a competative disadvantage in national markets, hurting the state's overall tax by reducing sales and income. (And really pissing off your constituents)

Of course, any economics professor will tell you that a sales tax is fundamentally regressive. Makes me wonder why we have a sales tax at all. Oh, wait, I know, politicians are dumb. In any given heirarchy, people will rise to their own level of incompitance.

Not only online retailers will suffer...

[EvilStein]

Just think of how much business FedEx, UPS, Airborne Express, DHL, and other small courier companies make off of internet commerce. These packages that people are purchasing need to get from point A to point B somehow. If online sales end up taxed, there will no longer be any point to buying online because you'll be hit with tax *and* shipping & handling. People will just buy stuff locally (unless the local vs online price has a huge difference) and shippers will suffer in the long run.

This should be simple

[ilsa]

Ok, we all know that sales tax helps the state and local government provide services, right? And judging from the comments most of you know that if you buy from an in-state mail order or internet retailer that they charge you tax and send it on to the state. Some of you even know that in states where they have income tax you are *supposed* to report to the state any such purchases from out of state vendors and send the state thier fair share of "use tax."

Now, what if instead of your local government demanding a cut of your non-local mail/net order purchases, tax is paid based on where the purchase was made? You buy something from Amazon.com, then Washington state and Seattle get the tax money. You buy from Apple's online store, California/Cupertino gets it. After all, you don't get a tax break if you buy from the Best Buy in the next state instead of the one down the block, do you?

This avoids the complecated process of non-local retailers trying to figure out just what is the state and local sales tax in Smalltown SD and where should the money be sent. It also keeps city hall from knowing you ordered stuff at that online sextoy shop.

No nation has ever taxed itself into properity!

[V_drive]

taxes are already too high. i don't oppose national sales tax (in fact, i think it would be more fair than the current national income tax). the problem is when new taxes are created in addition to existing ones.

many people (many of them in washington, unfortunately) believe that nothing else changes when taxes change. if a tax hike is proposed, we see predictions of how much extra revenue will be generated. if a tax reduction is proposed, we hear about how much it's going to "cost" the government.

the fact is, many people buy online because of this tax break. if a tax is added, people will buy less stuff--not good for an economy. in the end, lower taxes actually lead to higher tax revenues through a stronger economy.

critics are fast to point the finger at reagan's tax cuts for national debt. the truth is that tax revenues doubled during his presidency--it's just that spending rates increased even faster. determining whether that blame should go to congress for social program spending or reagan for military spending is an exercise for the reader. i'm just talking about revenues here.

Re:No nation has ever taxed itself into properity!

[Anonymous Coward]

i don't oppose national sales tax (in fact, i think it would be more fair than the current national income tax).

Why? Because it's regressive?

States "Try??"

[Eric Damron]

Washington State law already requires that vendors charge a sales tax on the full amount of the order. Including any gift wrapping etc.

no taxes?

[mblase]

What politicians fail to understand is that the major draw to e-tailing is the lack of taxes. ...which only matters until the consumer places an order and realizes that, special offers notwithstanding, shipping charges usually outweigh anything the state tax system could or would impose.

No, it's the convenience that people like, of having the selection of a warehouse combined with the convenience of an instantly-searchable catalog. Any boloney about people going online just to dodge taxes is exactly that.

Re:no taxes?

[s.fontinalis]

BS.

Many merchants offer free shipping for purchases over $100. Now here in California we pay 8.5% sales tax - with no charge for shipping, your saving actual money (defined as a lunch out).

Nutcase

[Anonymous Coward]

Governments waste our money. It is totally wasted, and does not contribute to the economy, only to the hand gripping our throats.

Uh...yeah. Whatever crack you're smoking, /DCC SEND some to me, would you?

Unconstitutional

[Burning*Cent]

Because "No Tax or Duty shall be laid on Articles exported from any State" (Article 1, Section 9 of the Constitution of the United States of America), taxes on sales between two different states are probably unconstitutional.

Of course, sales that occur inside of a single state are probably taxable.

Re:Unconstitutional

[InnovATIONS]

That is why, once the states have done their agreement on how to simplify the process, they need to get congress to pass legistlation to enable this. Technically it would be a federal collection distributed to the states. Previous attempts to do this have faltered as the direct-sales lobby has argued that it would be ruinous for small businesses to have to deal with every state and local taxing jurisdiction.

That is why the normalization of rates and of procedures is so key to this whole thing, because it reduces the primary objection to it.

Paperwork is as much a burden as the taxes itself

[InnovATIONS]

One effect that this whole no-taxation thing has done is to encourage businesses to locate outside of the states where their customers are, so that fewer of their customers need to have sales taxes collected. Thus a state with a lot of customers looses out twice. It loses out on the sales tax itself and it loses out because the mailorder/ecommerce firm decided to locate itself in, say, Nevada rather than California.

To say that the mailorder/ecommerce firm does not have any impact on local infrastructure is a bit decptive. All of the roads and other delivery infrastructure does need to be in place.

It doesn't say in the article, but if they are doing this fairly then there needs to be a split between the sending and the recieving state of the revenues.

But even more than that there needs to be a single reporting form and system (which seems like they are proposing from the limited information in the article). Just filling out the sales tax form for California is a big pain in the butt for our small business. If we had to obtain a resale number and fill out a separate form for every one of the 50 states, some of which might want monthly, others quarterly, and others annual reports on different deadlines...and that is not even starting on all the various city and county jurisdictions.

They already are

[Anonymous Coward]

"Why, exactly shouldn't online retailers be taxed like everybody else?"

You're starting with a false premise and making something seem vaguely ironic.

1) Everybody pays taxes. If you don't, you go to jail

2) A *retailer* doesn't pay sales tax, customers pay sales tax

3) An online retailer doesn't make use of services the way a physical place does

Perhaps online should be taxes (I think it shouldn't), but your "argument" is just dumb and meaningless.

Try putting more thought into your position next time.

States already tax internet

[pinkUZI]

States already tax the internet and all interstate commerce. It is called use tax and in most states it is the same as your sales tax. You are required to self-report all purchases each year with your personal state income taxes. I don't really know what states w/o income tax do.

You already owe taxes on mail order

[ACNeal]

Most people simply don't pay them.

If you order something from a company outside of your taxing body, your taxing body can charge you taxes on it, and in fact, generally do.

If the state you are ordering from decides to charge you sales tax also, then you can get hit twice.

The problem for the states is that they don't have an efficient way to track those purchases, and don't have the where-with-all to go after you for money.

Tarrifs are not the bottom line

[EEgopher]

Japan paid little heed to the price involved in conquering a delicious chunk of the American auto market. Companies and nations alike, if their desire is strong enough, will avoid tarrifs or simply pay them and get the fat American sales.
A "sale" is a good transfered from seller to buyer in exchange for a price. Thus taxing online sales would be fair, but unnecessary at this early stage in e-commerce development. Of course, the issue of "where" the sale takes place becomes problematic, perhaps the courts have already decided it, I don't know.
I simply want to mention that tarrifs mean very little if the commodity is hot enough (i.e. japanese cars, semiconductors, etc.) and protectionist government actions are EXACTLY how other nations get rich off of American inventions.

State governments eye-ing the golden goose

[KilroyTheVeg]

"The article is speaking of retailer tax based on retailer location."

No! they are talking about remote retailers/e-tailers collecting the local state sales taxes without "nexxus" (physical presence).
That is why a "new" tax on internet based sales is unnecessary and redundant.

The "Use" tax mechanism already exists to cover out of state purchases. How many different ways do "they" need to try to collect the same money?
State governments is eye-ing the golden goose and sharpening their collective tax-man axes.
Why force the e-tailers to collect their sales tax for them, let the states enforce their existing use tax laws.... It is not "our" fault the majority of citizens ignore it.
I don't pay the use tax either, why? 'cuz they aren't enforcing it.
Go ahead and tell your extended family about the use tax this Thanksgiving, they will all be dumbfounded that such a thing exists...

Anti constitutional

[cardshark2001]

From the article:

"It's a big issue right now because the states are in big-time fiscal distress," said Nathaniel Trelease, a Denver tax lawyer and chief executive officer of WebCredenza, an online provider of legal and professional education services. "Most states are running budget deficits, and they're looking ever more aggressively for ways to stem the erosion of their tax bases."

So aggressively that they're willing to stomp on the constitution before setting it on fire to burn the flag with.
Correct me if I'm wrong, but isn't it unconstitutional for states to impose tariffs on each other? Isn't that why there is no sales tax on goods bought in another state?

If you think this is bad...

[Anonymous Coward]

Don't ever move to Sweden! Some examples:

VAT: 25% on most items, 12.5% on food

Property tax: 1% of assessed value

Capital tax: 1.5% of all capital above $100000 (the value of your property is also added here)

Income tax: Depends on income, up to 50%

And these are only some examples. This is what you get when you let the socialist party govern together with the former communist party...

Thanks!

sales tax

[Anonymous Coward]

The argument seems to be that it is unfair for the Internet to escape the state sales taxes that are foisted on Joe Average Business owner. The problem isn't that the internet is tax free, the problem is that the state has a sales tax.

I live in MA. We have a sales tax. MA is next door to NH, which has no sales tax. When you want to buy a car and escape the sales tax where do you go? NH. It's horribly unfair to car dealers in MA, but it isn't NH's fault. It is the fault of MA.

Re:Great idea: Make things harder for online bidne

[geekoid]

You are suppose to report any purchases out of state to the tax franchise board, and pay CA tax on your purchases to them. Every time you buy something and don't pay a tax to the CA franchise board, you are commiting tax fraud.

Complexity is a Bad Argument

[ProfDumb]

It would be burdensome to expect a mail order operation, doing business across the country, to be familiar with the hundreds, if not thousands, of local tax jurisdictions and which apply to any given transaction.

Or rather, it would be a good argument if the states were not offering to provide, for free, a simple piece of computer code that would translate a customer's address into an appropriate tax rate. I am sure they are also willing to provide a clearing house to collect the payments and then redistribute them to the states.

Your argument was a good one in the days before computers, which is why out-of-state catalog sales did not have to withhold taxes. Now, the complexity argument is easily overcome.

It is a fundamental notion of economics that taxes ought to distort behavior as little as possible. The current tax regime favors catalog sales over on-site retail sales, for no good reason, and that ought to change.

Re:Complexity is a Bad Argument

[Anonymous Coward]

> Your argument was a good one in the days before computers...

Actually, it still is a good argument. Government involvement in computers still means, literally, millions of dollars in expenses. Consultants, legal changes at will, rules making from hell designed to favor one player or another, utterly ambiguous rules which lead to compliance "errors", fines, and legalistics management. A very, very, ugly reality.

Anyway, let's start out simply. What language/OS/application would that "simple piece of computer code" run under?

And the idea of states providing a clearing house is preposterous. Managing those simple "do not call" lists is proving to cost millions, yes MILLIONS, of dollars PER YEAR to OPERATE. Good God, there are pathetically few phone numbers for a modern computer to handle, and all you need sofware wise is a web page that pipes the marketer's list thourgh 'sort' and 'diff' and a web page to add numbers to the black list.

Millions? Yea, right.

> It is a fundamental notion of economics that taxes ought to distort behavior as little as possible. The current tax regime favors catalog sales over on-site retail sales, for no good reason, and that ought to change.

Not true, but spoken like a true owner of bricks and mortar.

First, Taxes ought to ethically refelect value added to the commons on the taxpayer's behalf.

Second, if there ever was such a "fundamental notion" why is damned near every tax rule designed to bias behavior towards a socially engineered outcome?

Third, The current tax regime already collects appropriate use taxes from the infrastructure over which mail order/on-line operate. To add to that burden of taxation, which is already bundled into the cost of the product, would in fact dis-favor such sales.

Re:Complexity is a Bad Argument

[InnovATIONS]

The tax RATE is only a tiny part of the problem. A sales tax reporting form is roughly as complicated as a form 1040A (I have filled out both).

Now imagine having to fill out about 50 of them, with entirely different formats, different rules, different reporting deadlines, PLUS all the various county and city forms.

Then imgagine that you had to get set up with all these various agencies just because you wanted to sell some stuff on ebay and you had to do it before making your first sale because you had no idea where your sale might be to.

That makes a pretty steep barrier to entry, does it not?

Would you rather have e-commerce where half the sites say 'sorry we aren't yet set up to sell to anyone in your state'

Re:Complexity is a Bad Argument

[damiangerous]

Your argument was a good one in the days before computers, which is why out-of-state catalog sales did not have to withhold taxes. Now, the complexity argument is easily overcome.

Then there's still the little matter of jurisdiction. Podunk, NE, has no authority to require West Podunk, SD to collect taxes. They simply cannot mandate the actions of any other cities, let alone ones in other states. It's the Constitutionally mandated job of the Federal government to regulate commerce between the states. As the Supreme Court has stated, a business must have a "nexus," some sort of physical presence, to be required to collect sales tax in a given jurisdiction.

This is mostly a moot issue anyway, as I originally stated. You're not exempt from paying taxes on out of state purchases no matter how you spin it. You just haven't been caught yet (if you aren't reporting it).

The current tax regime favors catalog sales over on-site retail sales, for no good reason, and that ought to change.

This doesn't make sense. To the end consumer, taxes are not the difference in choosing retail or catalog to buy. The end consumer must al be concerned with the price of shipping purchases made online. This is usually greater than any tax burden would impose. People are not flocking to mail-based shopping to beat the taxes. They're doing it because of variety, convenience and price.

No need for Taxation ever again

[RgnadKzin]

The accumulated total of off the books assets held by the aggregate federal, state and local governments is currently in excess of 60 TRILLION dollars. At a modest rate of return, there would be no need for any further taxation anywhere in this nation.

The Biggest Shell Game For Theft In This World's History

Essentially, the annual budget is based on income (revenue) v expenditures. When there is money left over at the end of the year, it gets transferred off the books into one of many "funds" held by the multi jurisdictional municipal corporations that masquerade as government.

Check these methods to determine whether state and local governments have excesses of your tax dollars

Why do you allow yourselves to be taxed when there are planty of funds already in the hands of the "state" to meet the needs?

Lack of sales tax is never the issue...

[aquarian]

Online merchants don't win customers on lack of sales tax. Any savings there would usually be lost to shipping charges anyway. People shop online or from catalogs because of better selection, service, and overwhelming savings due to things other than tax. So quit yer complaining. If you want to compete, do it on selection, quality, service.

Cut the "Use Tax" Excuse Crapola

[Anonymous Coward]

Most state law works like this: if you buy something from a seller located in your state, then the seller is required to pay the sales tax. Why? Because the seller already set up shop in your state, thus it's not an undue burden for him to collect the tax. If you buy something from a seller located OUTSIDE your state, then YOU are required to pay the sales tax. That's the "Use Tax". Why? Because it would be an undue burden on a seller located in Maine to have to deal with the myriad of state tax laws in all the other states. But it's not a burden for you -- you only have to deal with one law, *your* state's law.

We're getting all these posters posting We Already Pay The Use Tax excuse crapola. None of which have EVER paid the use tax. NO ONE DOES, except for giant, traceable transactions like a house or a car, which go into different categories.

And that's the point. The states used to ignore the tiny percentage of profit lost to cross-state purchases because it just wasn't worth it to track them down and nail the offenders (you) to the wall. But the Internet promises to change all that. In my region (DC) you can buy your groceries online in different state and have them delivered to you, for goodness sakes.

States can no longer afford to let this slip by. But the Supreme Court rightly has held that they can't make merchants pay the tax because state tax law is too varied and too weird. That's what the coalition is all about: to remove that justification.

Now you may see this as a Bad Thing because Dell doesn't make you pay sales tax, thus helping you in your criminal tax-evasion schemes. But it certainly is a help to your local computer reseller, who has to pay tax when Dell doesn't have to. It gives him an even playing field. And it helps your state retain jobs IN your state. Including, perhaps, your own. And it helps your state recover millions of money that you didn't pay, you twisted goon!

Let states compete on cost of doing business!

[aquarian]

If a state government can't keep the cost of doing business low, they get what they deserve. Hopefully, their constituents will do something about it, vote them out of office, and vote in leaders who can keep their state competitive.

The real problem...

[Anonymous Coward]

...is politics in general. As many people,so tritely, observe... people who want power are usually very self-centered and have no concern for the betterment of their fellow man. This is, sadly, completely out of alignment with what politics were originally intended to be. Let's take a look at the official definition of politics and break it down:

The science of government; that part of ethics which has to do with the regulation and government of a nation or state, the preservation of its safety, peace, and prosperity, the defense of its existence and rights against foreign control or conquest, the augmentation of its strength and resources, and the protection of its citizens in their rights, with the preservation and improvement of their morals.

Let's also consider that politics is considered a science, where "science" is taken to mean:

Any branch or department of systematized knowledge considered as a distinct field of investigation or object of study.

By this definition, a politician should have a great body of knowledge regarding ethics, citizens and their rights and proper morals. If you apply that branch of logic to the politicians of the last few decades, we find that there is something that has slowly gone seriously wrong. Our politicians tend to be anything but knowledgable, ethical, moral or have any concern for citizen's rights!

We will start with our current administration. The polls say that G.W. Bush has had anywhere from a 49% approval rating at lowest and as high as his post Sept. 11th rating of 93%. While this speaks well of him, it completely obscures many well known facts regarding his knowledge (quite lacking), ethics, morality and feelings on citizen's rights. If we delve deeper, we find that he, in fact, has very little knowledge about the system. Further evidenced by the fact that he is a poor speaker and his father's former cabinet appears to be running the entire show. He is just a mouthpiece.

Regarding ethics, I would question any politician's ethics who would have other men in thir cabinet involved in scandal. Especially in a position so close to the power seat as vice-president Cheney. Mr. Cheney's desire to conceal the connections between Enron and the current administration are very disheartening. Even the staunchest conservative must admit that this was not one of the finer moments in conservative history. (The liberal-controlled media argument doesn't wash here either as the news sources that reported negatively on this story tend to be just as far right as you can get.)

While Mr. Bush professes to being a good christian. He hasn't always been that way. His morals are not exactly what one would call "good". It's very well known the George W. Bush, was quite the party down, rich kid. As he grew away from his "youthful errors", he became quite the shady businessman. I would have to say that his morals are questionable at best.

Citizen's rights and the current administration are at odds with each other. This has been an ever increasing problem since Sept. 11th. As most Americans blindly wave their flags, their ability to do much of anything else to affect their own well being is being erroded by things like "The Patriot Act". In the name of security, the man in the white house and his staff are trying to convince us that it's good to lose your freedoms sometimes. This is quite damning evidence that he does not understand or care about the citizen's of this country's rights.

Seeing that all of this is true, it appears that George W. Bush fails to live up to the definition of what a politician should be, as do many of his cabinet.

The last administration has it's blemishes on many counts as well. Analyzing Mr. Clinton in the same way, we find that his knowledge of the governmental system was stronger than Mr. Bush's. (If anyone can provide links that prove otherwise please do so, I couldn't find any.)

Where ethics are concerned, Bill Clinton had his share of gaffes. Not to mention the more serious allegations regarding his time as Governor of Arkansas. No... Sadly, we can't say that Mr. Clinton has shiny repution either.

Everyone knows about his moral problems since they've been beaten to death. Like him or not, Bill Clinton was not a man of morals by strict definition.

As geeks, we all know that it was his administration that passed the DMCA which has potential to seriously impinge on citizen's rights. Not just your ability to "swap songs", but you ability to write code freely!

So, by the same analysis, Bill Clinton fails the test of what a good politician is. As do most other politicians. Why is this? Because we are humans. We have imperfections that prevent us from being able to truly hold to the ideals of what how politics should work. Some do better than others, but in general the lot of them are corrupt.

Most politicians are only interested in politics due to their hunger for power. Just that alone is damning as it points to a deep seated greed and selfishness that is almost required to be a politician. So how is it that our system even works? In reality, it doesn't.

Most of what the operations of the government and the way they affect us are almost 100% happily incidental. Ocassionally one person somewhere deep in the system does one thing right. Another one somewhere else in the system does something else right. And so on... There are the few people here or there who intentionally or unintentionally (They're human, remember?) do something wrong. But the aggregate result is something that more or les resembles a system that works. This illusion trickles upward toward the leaders (Senators, congressmen, governors, and ultimately the president) and makes them look good. (It works this way in any large organization) So... for now we are stuck with a system that appears to work, but is solely based on chance. Or looking at it another way, real politics (as opposed to the ideal defined above) is just another form of gambling.

In closing, I'll offer you this joke about politics:

Son: Dad, I have a special report for school. Can I ask you a question?

Dad: Sure son, what's the question?

Son: What is politics?

Dad: Well son, let's take our home for example. I am the wage earner, so let's call me the management. Your mother is the administrator of the money, so let's call her the government. We take care of you and your needs, so let's call you the people. We'll call the maid the working class and your baby brother the future. Understand?

Son: I'm not really sure dad, I'll have to think about it.

That night, the boy is awakened by his baby brother's crying, so he went to see what was wrong. Discovering that the baby had a heavily soiled nappy, the boy went to his parent's room and found his mother fast asleep. He than went to the maid's room, where, peeking through the keyhole, he saw his father in bed with the maid. The boy's knocking went totally unheard. The boy went back to his room and went to sleep.

The next morning...

Son: Dad, I think I understand politics.

Dad: That's great son, explain it to me in your own words.

Son: While the management is screwing the working class, the government is fast asleep, the people are being completely ignored and the future is full of shit.

---Whew! All that work just to post this---

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-X is unstable, let's get rid of it

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-vi is better then emacs (no it's not, emacs is better than vi)=Tastes great/Less Filling

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-Canadians are gay

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-~the fux0rz has spoken~-

Yes this is true.

[InnovATIONS]

I am part of an organization that runs a swapmeet for a fundraiser (we don't sell there ourselves, just sell the spaces to the vendors).

We MUST check that EVERY vendor has a state reseller's number (fortunately that is free in CA) and every vendor supposedly has to report and pay sales tax on their sales (whether they do or not is their business).

The state does check us and if we are allowing vendors to sell there without resale permits then they would fine us $1000 per vendor per week.

Actually there is an exception in the CA sales tax law for limited face-to-face sales of used personal property but since we can't check on what everybody is selling we have to insist on a resale number from everybody.

North Carolina already has a Internet Sales tax

[nexusone]

It is North Carolina Tax law that you file on your tax form the amount of anything you have purchessed and not paid any state sales TAX on it.

It applies to internet purchesses, if you did not pay the CA sales TAX say for computer parts from CA. You must pay NC sales tax on it. But of course they have not real way of knowing unless they start making your show all of your credit card recepts on your TAX form.

Re:North Carolina already has a Internet Sales tax

[Anonymous Coward]

I was talking to a buddy of mine who is the son of an SBI agent...told him about this fishing expedition in the NC tax code and he didn't believe it existed....when I told him to go back and read his NC tax forms he shrugged and said "well I don't pay it"...(names withheld to protect all involved)...fun when even families of law enforcement don't even care...

Re:then vs. than

[kingkade]

Heh, please refer to here.

I don't feel like typing...

Won't this make spam taxable?

[myowntrueself]

So that spammers will have to pay the tax or have the IRS on their case?

Personally, I'd love to see spammers being chased by the IRS!!!

Re:offtopic(sorry)but

[sco08y]

Ah, if only it were so... Why'd those Saudis have to crash their planes into NY? Why not take out Hollywood?

Your, you're, yaw, yore

[DrInequality]

God I wish "people" could spell.

Your premise is bogus

[InnovATIONS]

Internet sales are taxed in the same manner as telephone and mail-order sales.

The internet is merely continuing the tax benefits that have been enjoyed by telephone and mail-order sales for decades, and for the same reasons.

So your statement is bogus, and nobody is presuming that the internet should be taxed any different than interstate transactions of mail-order or telephone sales.

The real question is whether these interstate sales should be treated any different than intra-state sales, not whether the internet deserves any preference over those other forms of inter-state sales.

hummmm....

[Anonymous Coward]

Lets think about this...So internet retailers profits are WAY down...hummmmm....LETS TAX THEM!!!!!!!!!!!!! *have to love government logic*

Re:Why, exactly shouldn't online retailers be taxe

[DeputySpade]

(quote)"Online companies don't use state services," he said. "If you're going to the store to buy something, you're going to be driving on the roads and the store will be using police protection or fire protection and other state services for which it would be appropriate that they charge a tax."(endquote)

What a load of crap!

Do the UPS trucks not run on public roads, and do the online stores not get billed for that? Or the trucks which bring goods to the warehouse? Speaking of the warehouse, does it not require police and fire protection?

No Sales Tax in Oregon

[lordshrike]

Oregon does not have a sales tax and most likely will not have one any time soon. If you do not have a brick-and-mortar store front then register your company in Oregon. Some states may still require a sales tax but the responsibility falls entirely on the consumer to report it and pay.

Misleading article title

[DunbarTheInept]

What a misleading alarmist title.

This is not about taxing the internet. It's about taxing sales, as you mention, regardless of whether the order came via phone or internet. Calling it an internet tax is dishonest - it's analogous to calling the existing sales tax for mail order a tax on telephones, based on the screwy argument that the telephone was used to place the order therefore it's a telephone tax.

Article Unclear - Collection of Use Taxes?

[RDFozz]

One reading of the article could be that the new proposition would, in essence, make organizations selling over state lines responsible for collecting the "use taxes" that (most? all?) states have on their books, but that are in essence unenforceable.

If this is the case, then (ultimately) all the states stand to gain equal benefit (except those that have no use taxes).

Yes, the on-line businesses stand to lose money, in that they would have to spend money to track the sales, to make the payments, etc. However, what if that were made deductible on their state/federal income taxes? Businesses would be able to implement this at what would amount to no cost. Yes, the states would get screwed moderately (or the opposite, if they have few companies the do business out of state).

However, if you look at the numbers on the map at the end of the article, I suspect that most states would be willing to take the short-term risk of allowing such exemptions in order to get the long-term gains of suddenly being able to actually collect all those use taxes.

there is a joke...

[Anonymous Coward]

about "how government works" that basically involves a guard being hired to protect a scrap yard, and over a short period of time a team of about 25 others (who all get paid more than the guard) are hired to "oversee" him. When they find they are grossly over budget they lay off the guard.

The problem is not in the lack of income it is in the expendatures. Get rid of big government and we will all be happy... well all hard working people of the world will be happy.

But wait!

[PhxBlue]

Let's throw forward another scenario:

I'm a legal resident of Pinellas County, Florida. I live in Montgomery, Alabama, as a consequence of being stationed at Maxwell Air Force Base. So, can someone tell me why I should owe the state of Florida a use tax on a product that I order from, say, Maryland?

Re:But wait!

[anthony_dipierro]

Because Florida provides you with services, such as processing your absentee ballots and protecting your legal residence from invasion from Mexico.

Re:Why, exactly shouldn't online retailers be taxe

[Anonymous Coward]

That's why UPS pays taxes, and why there's a sales tax on UPS shipments.

NEXT!

You're Wrong

[waldoj]

If your state has a sales tax, you have always been resposible for paying taxes on out of stata purchases to your franchise board. under Use tax.

Wrong. Federal law protects out-of-state sellers from having to collect taxes for states in which they have no physical presence. When you order from some catalogs, they list a few states and say that, if you order from those states, you have to pay a sales tax. That's because they have employees, offices or property in that state, and thus they are compelled to pay that use tax. Short of that well-known exception, you're completely wrong.

-Waldo Jaquith

From an economic perspective...

[chrisbw]

One could also look at this another way:

The states are trying to maximize their tax revenue.

By taxing online purchases, they're raising the final cost to the consumer of the product. There will be a certain number of consumers (the marginal consumers, if you will) who will determine the total price to them too high, and thus will not make the purchase.

Granted, one cannot calculate out the total numbers, but it's likely that the revenues these states expect to gain from this additional taxation may not be at the levels they estimated, and we may be better off as a nation in a time of economic recovery to be stimulating the economy through these additional purchases.

Just a thought.

Re:From an economic perspective...

[anthony_dipierro]

Granted, one cannot calculate out the total numbers, but it's likely that the revenues these states expect to gain from this additional taxation may not be at the levels they estimated, and we may be better off as a nation in a time of economic recovery to be stimulating the economy through these additional purchases.

It's likely that the revenues may not be at the levels they estimated? Which one is it, likely, or just possible?

In any case, if the states can do this constitutionally, then I'm all for it, because it's not about taxing something that wasn't taxed, it's about enforcing a tax that's already there. So the only people who will be affected are already criminals anyway.

Re:From an economic perspective...

[chrisbw]

...it's not about taxing something that wasn't taxed, it's about enforcing a tax that's already there. So the only people who will be affected are already criminals anyway.

That is not correct. From the article:

But the Supreme Court has ruled that states can't tax sales from electronic retailers that do not have a physical presence within their jurisdiction.

These sales are currently not able to be taxed by the states (assuming there is no physical presence in the state). Nothing illegal going on here.

Re:From an economic perspective...

[anthony_dipierro]

But the Supreme Court has ruled that states can't tax sales from electronic retailers that do not have a physical presence within their jurisdiction.

These sales are currently not able to be taxed by the states (assuming there is no physical presence in the state). Nothing illegal going on here.

Yeah, so they don't tax the sale, they tax the use (upon arrival in the state). It's no different, except that it's a lot harder to audit individuals than businesses. You're supposed to report your out-of-state purchases to the government (in those states with sales/use tax). If you don't you're breaking the law.

Ok.... What I want to know is....

[3seas]

Whatis it about the word "NO" that they don't understand?

Social Security

[Blackneto]

I don't think you will have to worry about SS dissapearing by the time you are eligible for it.
My resoning is this...
Old People. They vote more often and more consistantly than young people. During Election time the SS subject gets dragged out, propped up, scrutinized and put away for that very fact.
Unless political thinking changes SS will be around for some time.

Order "on-line" in the store

[Baki]

So I suggest that all brick and mortar stores install some terminals where customers can make an " on-line" order while being in the store. After that they can instantly pick up their "on-line" order and avoid paying tax.

Catalog vs. Online?

[ckotchey]

One thing I've never understood is why everyone seems to want to differentiate between on-line sales (which are relatively new) and catalog sales (been around forever). After all, they're essentially the SAME THING. The only difference is that in one case the order is phoned in, and the other, the order is basically e-mailed in. NO DIFFERENCE.
If people are going to talk about taxing it, at LEAST talk about it for what it simply is: out-of-state purchases. Just pass a simple freakin' law that says "tax applies per the state the product is ordered from" or drop it! Cripes - such a simple problem with two very simple solutions.

Re:Catalog vs. Online?

[styzygy]

ckotchey, the laws you speak of already exist. They're called use taxes, and they require you to report out-of-state purchases to your state and pay tax on them. Every state that has a sales tax also has an equivalent use tax. Whether you order by mail, Internet, or drive to Delaware (which has no sales tax) and then carry the goods home yourself, the rules are the same. It's just that most people don't understand them and don't follow them.

This would kill UPS...

[anthony_dipierro]

Let's face it, making internet purchases has its plusses and its minuses. Sure, you don't have as much brick and mortar, but you have shipping costs. So why don't huge companies like Amazon simply open up distribution sites in every state? Even better they could open up pick-up locations and offer completely free shipping...

The reason they don't do this. The only reason, is because if they open up a pick-up site in my state, New Jersey, they'd have to pay sales tax every time someone from New Jersey buys a book. So instead they open up a huge warehouse in Deleware, and have New Jerseyites pay shipping instead of sales tax.

Makes it sound pretty damn inefficient, doesn't it? In fact, if you're at all an environmentalist, you should be strongly in favor of the states succeeding in passing these laws. If you don't like sales tax, move to a state that doesn't have it. Don't steal from the government by committing use tax evasion.

Principles only.

[nurb432]

There is obviously a point where it does not apply, but over all when you increase taxes the spending power of the people is reduced, and lowers the volume of taxes recovered so that the net result is lower revenue ( and a pissed off populace )

I was speaking of principles, not the actual number value for the ceiling, or floor of functional rates. ( yes i do feel that SOME taxes are ok, as a national entity that provides protection and other related items is a good thing.. )

What is the lowest taxation point that would still achieve a reasonable governmental revenue due to increased volume? I have no idea, as I've been over taxed for my entire lifetime. I dont expect to ever see that change.

Re:Principles only.

[anthony_dipierro]

There is obviously a point where it does not apply

I would argue that we are below that point already.

I was speaking of principles, not the actual number value for the ceiling, or floor of functional rates.

If you're going to speak of principles, then you should mention that raising taxes may raise revenue, or it may lower revenue, and you have no idea which it would do. Alternatively, point to an economic study showing that this particular tax enforcement strategy would lower revenues.

Re:Principles only.

[nurb432]

Um, i have to disagree i DO know what it will do. Anyone with a little grey matter would know. We dont need to point to some biased study designed to prove what the organizers want to prove. Economics theory is pretty much common sense, and doesn't need to have some 'official' entity stating the obvious for it to be true.

Higher taxes mean less spending power. That equates to a reduction in purchasing, thus a reduction in revenues. I see it everyday the real world. People DO make decisions based on this. We purchase less gas, or reconsider moving to an area with higher property taxes, reduce smoking. The list goes on and on. Each one a direct result of the higher taxes, causing reduced purchasing power.

Ever hear of the 1980's when Regan demonstrated that reducing taxes increased the tax revenue because it increased the VOLUME of spending / investments?

If you feel that we are currently on the bottom end, and that they are entitled to your entire income, then feel free to pay a higher rate, i however will protest as the rates are too high now and they are taking much more then is acceptable. Oh and since you seem to have extra, please send some my way too, to offset the 1% hike in sales tax that prevents me from buying as much Xmas as i had hoped this year.

Just a personal observation, you sound rather socialist in attitude. Feel the same about personal rights, such as the 2nd, 1st and 4th admendment?

Re:Principles only.

[anthony_dipierro]

Higher taxes mean less spending power. That equates to a reduction in purchasing, thus a reduction in revenues.

Maybe, maybe not. Depends on the elasticity of the demand curve. For example, if a $100 item is taxed at 5%, increasing the tax to 10% causes a 5% reduction in sales, and there were 1 million purchases at 5%, let's look at the numbers. Original revenue was 1,000,000*$5=$5 million. New revenue is 1,000,000*(0.95)*$10=$9.5 million. So it depends on the elasticity of the demand curve, as anyone who has taken Economics 101 would know.

Just a personal observation, you sound rather socialist in attitude. Feel the same about personal rights, such as the 2nd, 1st and 4th admendment?

How am I socialist in attitude? I never stated whether or not the government should increase taxes, I merely stated that if they did increase taxes, they would probably increase revenues. Actually, I didn't even say that, because this isn't a tax increase, it is merely a change in the enforcement mechanisms which hinders criminals from committing tax evasion.

Re:Principles only.

[anthony_dipierro]

Ever hear of the 1980's when Regan demonstrated that reducing taxes increased the tax revenue because it increased the VOLUME of spending / investments?

By the way, the Laffer curve is generally only used to describe income tax revenues. The idea is that with a 100% income tax, no one would work. With sales taxes, on the other hand, there could certainly be a 100% sales tax and people would still buy things - they'd just have to pay twice as much.

Re:Principles only.

[nurb432]

True they would, just fewer items then they do with a lower tax rate.

This was my whole point in the first place. Regardless of what type of tax, if they go up spending ability goes down, and tax revenue is reduced since the higher per unit tax does not compensate for the volume reduction..

I just used one tax as an example, average them all together to get the net effect of stifling the economy.

Though i could be wrong about the first statement.. at such an obscene tax rate, that might be the level that would start the much needed rebellion, not just reduce purchase volumes. The idea of 100% tax rate overall would never be reached due to this.. though it does get damned close before things melt down.

Re:Principles only.

[anthony_dipierro]

True they would, just fewer items then they do with a lower tax rate.

So?

Regardless of what type of tax, if they go up spending ability goes down, and tax revenue is reduced since the higher per unit tax does not compensate for the volume reduction..

No. That's not necessarily true. Volume will probably go down, but revenues might still go up.

Re:Great idea: Make things harder for online bidne

[anthony_dipierro]

I think this will just drive more people away from online business, sink a sector of the economy and drive prices up for the consumer (which means they'll probably spend less, which is a Bad Thing, especially when you're in a recession).

On the other hand, it might provide incentive to online businesses to open up retail locations where people can pick up their items. The decreased shipping costs will then drive prices down for the consumer, which means they'll probably spend more, which is a Good Thing, especially when you're in a recession. The increased revenues can then be used to lower the sales tax even further. So instead of having honest people pay taxes and criminals avoid taxes, you get everyone to pay, at a lower rate.

With the reduced number of trucks on the road you'll see fewer traffic jams, less need to build new roads (which means more lowered taxes). About the only loser will be the mail order shipping industry, which is probably that "sector of the economy" you were talking about sinking...

Double taxation, again

[Quixadhal]

I find it highly amusing that we (in most parts of the US) have to pay an income tax when we get the money in the first place, and then a sales tax when we spend it.

Wasn't this kind of double-taxation one of the reasons the colonies broke ties with England and fought a war for independance?

So now, I can buy something overseas and am supposed to pay taxes to my government for... ummm... hmmmm. Well, it can't be for the goods or services, since those come from outside the country. It can't be for me, because I already paid my income tax. It can't be for my internet connection, because my ISP already pays taxes for their earnings (which come from me). I'd say it was for import duties, but oh yeah, those are seperate fees that get levied by the federal government, this is a state tax.

I give up, why do I need to pay this (other than because the state has guys with jackboots and guns telling me to do so)?

Re:Double taxation, again

[styzygy]

We broke from England because of taxation without representation, not "double taxation." You have elected representatives who decide your taxes. If you don't like what they're doing, you can complain and you can vote against them. Not that what you do will matter much with our broken 2-party system, but that's a topic for another thread.

Believe it or not, part of the reason we have so many kinds of taxes is an effort to be fair to everyone. Some taxes, like sales tax or property tax, hurt the poor more than the rich. Other taxes, like our tiered income tax, balance that by being much harder on the wealthy. The overall effect is to spread around the pain, so no income strata is unfairly burdened versus the other strata.

The reason you need to pay this is spelled out in the Constitution: the government exists to secure your rights to life, liberty, and the pursuit of happiness. You want the government to keep Saddam Hussain from taking your land? Lock up snipers who want to kill you? Stop greedy inside traders from swindling you out of your retirement savings? Help you if your house is destroyed in a flood? Then you have to accept taxes.

Subject

[Anonymous Coward]

This is a simple test - please ignore.

You're misunderstanding...this is not a new tax

[styzygy]

There's a common misunderstanding that Internet sales are currently tax-free. They aren't tax-free and never were.

Every state that has a sales tax has "use tax" laws that require you to pay tax on stuff you buy from out-of-state. It's called a use tax instead of a sales tax, but it's still the same tax.

The use tax exists because jurisdictions can't force a seller to collect tax where they have no physical presence. The courts have consistantly ruled that this would put an unfair burden on the seller because of the complexity of tax and filing laws. Since they couldn't force the seller to collect the sales tax, states require residents to report their purchases and pay a use tax equal to the sales tax.

Anyone who, for example, buys a computer from Dell by mail-order but doesn't report the purchase to their state and pay the tax due is breaking state law (unless you live in a state like Delaware, which doesn't have sales or use tax).

Individual consumers can get away with not reporting their puchases and paying the use taxes because it's too much trouble for the government to pursue them. Like speeding, just because the odds of being caught are fairly low and everyone is doing it, that doesn't make it legal. Businesses generally do end up paying the use taxes because they're larger buyers and get targetted for audits if the state suspects they aren't reporting their out-of-state purchases.

This has been a problem for decades with mail-order, but the spotlight is coming on it because of the Internet. Although currently only about 1% of total sales are online, it's a growing segment. Also, Internet technology actually makes it more feasible for sellers to collect sales tax without undue burden.

The idea behind Streamline Sales Tax is to make it so easy to collect the taxes that the courts won't see it as a burden. So, if it goes through, it only means we all might end up paying the sales taxes that we've been illegally avoiding all these years.

The Internet tax amnesty bill is a totally different subject: it only protects us against NEW taxes targeted specifically at the Internet. It was never intended to protect us from the sales taxes that were already present but unenforcable.

Net taxation was always inevitable

[WillAffleck]

I said it back in 2000, but you all said that Net firms would rule, would spend too much money, would be so successful that politicians could not oppose them.

It's not 2000 anymore - it's 2002. Net firms are weak, state budgets are in crisis, politicians can't let up to one-sixth of commerce go untaxed anymore, not when they're bleeding red ink all over.

You can fight them on fairness, but Net transactions will be taxed. Choose your battles - and remember that you have few allies left, and your forces are decimated and in disarray as you take on the bricks and mortar firms with blood in their eyes, as they eye the Net firms weak and wounded before them.

Last Post!

[alpg]

Winnuke in one line? No problem:
perl -MIO::Socket -e 'IO::Socket::INET->new(PeerAddr=>"bad.dude.com:139 ")->send("bye",MSG_OOB)'

And formatted so it's a little easier to read:

#!/usr/bin/perl
use IO::Socket;
IO::Socket::INET
->new(PeerAddr=>"bad.dude.com:139")
->send("bye", MSG_OOB);

-- Randal Schwartz

- this post brought to you by the Automated Last Post Generator...