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Internet Taxation May Be Imminent
redfenix writes " Here, there, and everywhere, the words "Internet Tax" are being uttered with intentions of bolstering state budgets. It may be inevitable that products purchased on the net will be taxed someday. The real question is: can the fragile internet economy really help local tax economies now?"
Why not just cut out all the waste/fraud before they raise taxes again?
That's what you get when you liberals vote for tax and spend Democrats
Come 2004 vote for George Walker Bush
a true American Hero!
And we go back to mailorder, out of state purchases, called in by phone..
It seems to me that most internet retailers are operating on such razor-thin margins that adding a sales tax would probably shove them further over the edge in to non-profitability.
"Moderate drinking can help prevent amputated limbs" -- Abigail Zuger, NYTimes, 12/31/02
This makes a lot of sense. Sure, I'm a libertarian who believes in a very limited government, but I also believe that taxes should be used to pay for infrastructure and civil defense. So, with the Internet becoming an increasingly important part of our national infrastructure, it only makes sense for the states to be able to tax us for the upkeep and maintainence of this valuable service.
--sdem
They tax you when you make money, they tax you when you spend it.
THIS IS ILLOGICAL AND MORALLY WRONG.
There should either be no sales tax or no income tax. But not both.
Can anybody explain to me WHY we have both types of taxes?
If the goverment takes more of our money, that doesn't help the economy recover -- it hurts it. When taxes are lower people have more money to put back into the companies that power the economy. While it is true that the government is the biggest "company" in the country, it is also one of the most inefficient and wasteful.
Perhaps the states should learn how to use their existing funds better, rather than forcing people to give them more money.
Travis
Maybe they wouldn't need to tax internet sales if Bush weren't pushing a $674 Billion Tax Cut.
So Long, budget surplus! So long, fiscal responsibility!
The theory of relativity doesn't work right in Arkansas.
Why not just cut out all the waste/fraud before they raise taxes again?
If this happens do you think it would work like English road tax (the older the car the less you pay?) My 1Ghz box should be cheap to tax by then! :)
can the internet economy help the local economy ? nope, at least not in its current state.
now there maybe a side effect - people finding it cheaper in stores. (the extra 8% online plus shipping might even out the cost) but again your just killing online commerce by doing that. and not really helping out the local economy either.
i think somebody has the idea that the pr0n sales online are actual "commerce" transactions. *whoops*
"Two things are infinite: the universe and human stupidity; and I'm not sure about the the universe." --Albert Einstein
An internet tax will do nothing more but hurt internet sales. Shipping charges and taxes??
The cost to buy something "cheaper" online would become a internet myth.
-Scott
As a Washington resident, I already pay sales tax to online retailers - most recently Amazon and Half.com.
Visual IRC: Fast. Powerful. Free.
Just call it Tax#, and everyone will just jump on board!
Neck_of_the_Woods
#/usr/local/surf/glassy/overhead
If a state like Wisconsin loses $300 million or $400 million or $500 million a year in revenue because of untaxed catalog sales, someone, someplace in the Badger State is going to pick up the difference. Who? You and I; through either increased income or property taxes.
Yes, but in that sense, "you and I" are also the people who are buying and "saving" the money. In the end its a wash. The average person who spends money online will save X and will then pay Y in increased taxes. I've got a feeling that X and Y are pretty close.
Why not?
I dont see the basis for your argument other than it is "illogical and morally wrong". Doesn't seem illogical to me. This taxes people when they make money and the spend so the government can allocate more money accross the board, instead of concentrating it in one area.
Besides, sales tax is for the state, income for the fed, they're fairly independant.
It doesn't really matter to me. I live in Oregon and we don't have sales taxes.
Politicians will always want to tax anything where there's a movement of money.
Therefore, from now on, I will think about politicians whenever I need to make a movement.
But seriously, simply just destroy *credit card based* E-Commerce, plain and simple... It won't destroy commerce over the web - i.e. Amazon might offer their wares on a COD basis, thus bypassing the fact that any transaction actually "occurred" on the internet. Also, mailed checks may still be applicable: "This check I've mailed you is for SKU#8546294 I saw on your website on 2/14/03..." Long before I had a credit card, this is how I conducted purchased on various homepages.
[Blows off dust from his paper checks]
Solomon
"Twice half-assed makes an ass whole." --Solomon K. Chang
They should tax spam. It's not fair, but fuck em.
Someone you trust is one of us.
This will solve several problems, and make the states lots of money. Also, there is plenty of precedent for taxing spam as part of interstate commerce.
Forced registration of spammers (a spammer's license) would enable people to track them down (spam hunting) and make money from the spammers. Money strapped countries around the world could get on board with this one.
The extra bonus brownie points for having a bounty on spammers avoiding the law just sweetens the deal. And Spamming would no longer be a free ride on the back of the internet.
This is a match made in heaven.
Why not use the greed of the law makers to our advantage?
"It is a greater offense to steal men's labor, than their clothes"
How am I represented with my tax dollar in the state of Ohio when the tax income is going to the state of, say, California? That's the whole reason interstate taxes don't exist in the first place. Ah well, it's all for the better.
The more taxes we pay, the more Iraqi we can eradicate. Thanks Mr. Bush.
What drives the Internet economy? Pr0n.
What should they tax? Pr0n.
"It'd certainly make chartered accountancy more interesting."- Monty Python.
ah do you guys realize that most sales tax laws in all states read like this:
"Items bought withint the state shall be charged a sales tax of.."
If it snot bought in the state you cannot be charged a sales tax because states cannot charge taxes on intyerstate commerce only feds can..
Now please will someone read something before they post it.. please.. the FUD is getting deep in here and I am drowning in it...
Don't Tread on OpenSource
.. but don't make it terribly complicated. Wish I had something more insightful to say than that, but I don't. Every time I hear this topic brought up, everybody and their mother wants to make it more and more complicated just to make it more fair. Personally, I don't care what the diffrence between 5% and 7% is, and I don't care which state it goes to. Hell, make it a flat tax and let me choose which state the taxes go to. :P
Hopefully, companies with significant Internet sales (Land's End, Amazon, etc) have enough lobbyists on retainer to slow down the implementation of these taxes. I suspect that we'll eventually see Internet transactions taxed in some way, but the additional bureaucracy involved in figuring out which of the thousands of taxing authorities has jurisdiction over each sales will be a nightmare.
Taxing Internet transactions in a fair and equitable manner will require wholesale changes to the way taxes are collected in the U.S. at the federal, state, and local levels. We're not ready to make this change yet.
** The opinions expressed here are my own, and do not reflect those of my employers - past, present, or future**
I see no reason to not have sales taxes enforced on internet purchases.
I am the Alpha and the Omega-3
Unless you basically prove that the goods are going overseas.
;)
I guess that is the advantage of one state being the whole country.
Are the states in America united
Bah.
governors are coveting more than ever the billions of dollars of sales tax revenue they could be taking in to fund schools and pave roads.
Sorry fellas. The average taxpayer sees 40%+ of their income go to various confiscatory taxes already.
We're spending $9000 per student per year on schools, which is enough to chauffer students to class in limosuines, and there are already massive taxes on gasoline, et al. to fund paving roads.
ENOUGH. Cut spending. Get rid of the 40,000 state workers with nothing to do. Quit borrowing money to build schools. Stop the waste. Right there is enough to balance any budget.
There are already taxes on internet sales, by the way. The internet is not a "tax free zone." New taxes should not be allowed. Period.
LadyStar - Your Magical and Mysterious Adventure Awaits
Convenience? Maybe. Or not. It can be a real pain trying to return something. Or resolving a dispute.
Most of the time, I'll be buying off the internet because of a price discount. But if the prices become equal, I'll just shop locally.
It would be far better if the politicians learned to reduce state spending - starting with their salaries, and cutting their own staffs. Somehow, none of them ever think of that.
So the question to ask is not if Internet transactions will be taxed -- but when and how.
-Thomas
Since when do state governments maintain the Internet?
The US government doesn't own the Internet, it just thinks it does. If we had to say anyone owns and maintains the Internet, it would be MCI, AT&T, et al.
Depends on what you use it for. The money I pay when I stop at a toll on the road is a tax used to pay to improve the roads. The social security tax I pay on my paycheck is used, for social security (the fact that it's dying is anohter story). So if there is an internet tax, it should be used to improve/maintain the infrastructure of the internet. Otherwise, screw it.
The GeekNights podcast is going strong. Listen!
"Internet Taxation May Be Imminent"
So... if it may be imminent, then it's not imminent, right? Heh.
Are all the states involved going to create Internet Taxation Departments to waste all the new money they'll make with these tax revenues or will they be able to waste the money with the current level of corruption and graft?
"All animals are created equal, but some animals are more equal than others." - George Orwell
Let's make it so inhospitable to do business in the US that companies have to locate their servers out of country and move yet another industry and even more jobs overseas. That sounds like a good way to boost state revenue!
Disclaimer: I am not sure I agree with what I am going to say but I have to say it does make some sense. If internet retailers were required to collect taxes based on the purchaser and return those taxes to the pertinent state it would seem reasonable since: 1) In essence their business has a presensce in every State and thus should follow current laws(the location of a internet server means nothing these days) 2) If I have the abilty to buy things without tax I will stop buying things in my own state and thus not be supporting the infrastructure that I use. This is already done within California with sales tax on cars. The sales tax you pay is based on where you live NOT where the business is, this was implemented to stop people from all buying their cars in the boondocks to save some money but they go and drive their cars all over the streets their tax dollars were not supporting the maintanece of.
A store in wichita that sells golfing stuff online aparently pulled in 6 million between thanksgiving and christmas. Im sure with that info out and our horrible budget here in Kansas, they would LOVE to get a bit of that pie.
The ultimate network admin tool needs HELP!
To quote our lovely tax form,
(note bitter sarcasm in my voice)
So you see, it was never about maximizing revenue in tough times - it is about unfair competition.
+++ UGUCAUCGUAUUUCU
I just wanted to get a maybe in the list of responses here.
A thread like this popped up on fark.com the other day, this quote seemed to shed some light on the issue.
"Why shouldn't the American people take half my money from me? I took all of it from them."
Edward Albert Filene (1869-1937)
With the current bipartisan agreement that a tax cut is a good idea to stimulate the economy (they just seem to argue over who's taxes should be cut), I have to wonder what the real thinking is behind all this talk of adding a new internet sales tax. Ok, maybe some states will be just enforcing laws already on the books, maybe not, but it's still a new tax payment for a great majority of folks.
What is it?! Should my federal taxes be lowered so that I can pay some new internet sales tax to the state? Why don't they just give money directly to the states and ignore the general populous instead?
It seems that either:
A) state politicians are too chickenshit to cut their budgets and piss off their over-demanding constituency
B) they're greedy for more funds and don't give a hoot about the national economy as a whole
C) a combination of the two.
Either way, I think an internet sales tax would (at least partially) cut any federal tax-cutting stimulus package off at the knees.
Then you can sign this petition.
I don't see the big fuss from a tax perspective - the paperwork is the problem. Of course the level of government waste and high rates of tax are a disgrace but this is not really a new tax, just a shift in enforcement of an existing one.
Not wanting to give the money grabbers any ideas, but I have not been directly taxed for viewing a web page, sending an email, etc. Sure, I pay lots of indirect taxes related to connecting to the internet (just try to make sense of all those charges on you phone bill sometime), sales tax on my hardware, utility tax on my power bill, etc.
The so-called internet tax is not a new tax. Most states require the purchaser of out-of-state goods to pay a "use" tax on those items. Of course most people don't. Note, this also means that out-of-state sellers have an unfair advantage over local businesses.
The real shift of the "internet tax" is to place the burden of collecting the tax on the sellers. This is a real burden as it could dealing with 50 (or more considering local tax districts) rates, returns and such. The overhead of dealing with the government could be far more damaging than the effect of the tax itself.
Of course (as always) someone will build a business around handling the government overhead for you but that'll cost, too.
Final comment on taxes:
"If you could steal all the money you want and print all the money you want, don't you think you could stay out of debt?"
~~~~~~~
"You are not remembered for doing what is expected of you." - Atul Chitnis
It won't matter where the servers are. They'll do it based on where the items are shipping from. When it comes to taxes, lawmakers know how to write laws to be effective.
They should have been doing this all along.. internet access has always been something that has been accessible only to the people who can afford the luxury of a dialup ISP or even broadband. Those are the people that should be taxed, not the people whose income dictates that they must shop locally. If anything the lack of tax has been a form of discount to consumers who make a certain minimum income.
its sort of like, "If you can afford $20+ a month, you get a discount on purchases as long as you use the internet to make them!"
Granted more and more people are getting online and it is becoming more and more affordable to the general public, but still not everyone has internet access, and not everyone can afford to get online to do their shopping!
Scary part is, nothing gets taxed without first being regulated to death. I think that's a law of physics....
Is how politicians always have it ass-backwards. Rather than decide that there is a specific need for revenue, and then figure out how to meet it in a fair and non-burdensome way, they are always in "taxable industry" hunting mode.
"Let's just take what we can, and figure out how to spend it all later."
"No, let's tax air! Everyone breathes it, and we can give exemptions to people with emphysema!"
The way they run things, 5 years from now when they can't meet their budget, will they find a second internet to tax to make up for it? They need to learn to do sustainable budgeting.
Damn politicians.
Why can't they cut their salaries to a buck a year like the CEO of Cisco? (in addition, donate half their kickbacks^H^H^H^H^H^H^H^H^Hcampaign-contributions to help the state budget.)
Besides, just like there's no point in trying to repair a decrepit bridge with termite infested wood, increasing taxes to an already crappy economy doesn't help. It might backfire.
What my dad have always said when I tried to get my allowance when I was a kid comes to mind: "You can't get blood from a turnip."
-----------
"We don't have what we don't have." -- DUH!
Maybe they wouldn't need to tax internet sales if Bush weren't pushing a $674 Billion Tax Cut [216.239.33.100].
So Long, budget surplus! So long, fiscal responsibility!
Look, I know you don't really mean it. Surely, you understand that the tax cuts Bush has already gotten passed, and those that follow, are not just, "tax cuts for the rich," like some people suggest. It may look like Reaganomics, but I assure you, that by giving tax cuts to rich multinational companies and the rich people that run them, we are on the path to fiscal wealth. Obviously, until that time, the government needs money to operate. Who better equipped to keep the government coffers flowing than the middle class/working poor? They've got their jobs to pay the taxes, the rich guys have got the money to go out (of the country) and create more jobs, and the government has the money to give more money to the rich guys. Everybody wins!
One of those articles referred to the case in title, being shocked that any legal precendent has been set in ND, I looked that case up...very interesting read and something that may get tossed around during dicussion of an Internet Tax.
4 .Z O.html
http://supct.law.cornell.edu/test/hermes/91-019
forget it.
Who spends money online? Middle-Upper class people. Who pays property taxes? Everyone.
No sales tax on the net hurts the lower class.
Taxation is contractual. You are all operating through contracts for your taxation. Should you agree to any contract that annotes as you declaring to abide by all United States and Federal laws, you may be taxed. So, be of good cheer...unless you agreed to any federal laws. Being without contract would suggest you as being self-governing and within the bounds of Uniform Commercial Code and suggests that contracts are voluntary. Do not place your mark on any contract and do not grant any fiduciary control of your properties and effects to the United States and its Federal administrative body. They provide no services in exchance for the financial transaction known by scope as "taxation of the internet."
You are a sovereigned nation until you agree to contracts that abridge your sovereignty.
This has everything to do with the FCC. The FCC declares itself by contract as your regulation of your usage of propogation of Radio Waves. It is by contract, so this means that you are not regulated when you are not operating on their contract; yet by agreeing by contract to any Federal regulation of the United States would initiate you under a clause that ensues you to accept any administrative action of the Federal government regardless of defined scope of the initial regulation. The sky is their limit.
[try to] Have a nice day.
I know I will, because I have prosected the United States Federal government under the uniform guidlines as being compelled to contract by a non-commercial private organization (United States). Figure it out. If you already figured it out, then you would have already known that their laws are only as good as them forcing a non-qualified golden badge, a non-affirmed oath or affirmation, and a barrel of a gun down your throat to comply with their regulation. Perhaps their silence on these matters inspires the credibility of their accountability; should you be compelled to participate in the same tacticts as they do or do they not like the fellow competition of fraud? Light them up, kick them out...you can't do that when you lack millions of people (thinking of ghandi) or guns (think of 2nd ammendment of your Constitution).
Realistically, when did it become their information super-highway? And another thing, when did it becom their public highways to post road tolls? When will you choose to not abridge your freedoms by contract? It is only as good as your aim...
But I'm sure you already Gnu that.
To be so naive. That the taxes you pay actually go to the things you think they do seems reasonable, but it's often not the case.
Thats basically what I was talking about. Amazon.com could move a few miles north and do all their business out of Canada. It would be kind of hard for the states to tax that. The feds might get their share of some sort of customs/import tax, but it would probably still be cheaper and generate more sales for amazon. Not to mention they and all their employees wouldn't live in the US, so the states/cities would actually lose tax money by doing that.
All this does is reinforce the positions of the current big ecommerce players -- Amazon, Wal-Mart, K-Mart, etc. -- because they can most easily afford the software upgrades and new software packages/services that will be required.
A lot of small businesses found new life on the internet, becuase they were able to extend their reach. Now they're faced with huge new expenses to either develop new software themselves, or be chained to a third party who can. Unfortunately, this will probably Microsoft, Intuit, Yahoo Store, etc., who will rake in a fortune selling new ecommerce-in-a-can systems with tax tables built in.
I have a couple of clients who were thinking about expanding into web sales in the next year, but in light of this will probably nix the idea.
Vote Libretarian!!!!!!!!
US Military Budget this year is something like $780 billion US dollars. The ten year tax reduction plan Bush is babeling about is $670 billion over a ten year period.... In other words we are being given a tax break that is less then ten percent of the US military Budget, this year alone.
Now where is the government getting all that money from?
As to taxing the sale of products reguardless of what state the company and consumers are, via mail order (internet is just a means of communication) some companies (few) do it in a manner that the state the consumer is in determines what the tax is and also gets the money.
And what is taxes being spent on? Warmongering!
Unless this is a cross country tax, this proposed tax is worthless. Internet companies will just register under a different country than the country bringing in the tax.
Look at the case with some of the file swapping companies. They registered their companies under a different country and the RIAA can't touch them. This will happen now more and more if this tax comes in.
America stands to lose a lot from this tax.
I think Uncle Sam should tax whining about IP. Seriously.
Lagito ergo expectabo
It may be inevitable that products purchased on the net will be taxed someday.
I pay 15% on everything I buy on the net. Where are you living? Kuwait?
And that's the reason why you'll probably see some states not tax the internet. They'll realize they'll make more money for themselves by making themselves friendly to these companies. I'd expect it in the eastern part of the midwest. It's a good central location for shipping around the country.
There is no question the states are missing out on a ton of money: In the company I work for, we spent well over $1,000,000 in computer equipment last year. The sales tax here in my county here in Calif. is 7.75%, that means that the state did NOT collect at least $77,500 in sales taxes. That is a lot of money! Now multiply by all the businesses who did the same thing...
I don't know, I look at the bloat and waste of government, the useless bureaucrats secure in their firing-proof jobs, and I wonder if taxation for propogation is really the policy I want. I'm a political liberal in many respects, but I'm far more interested in the government being able to provide services well, not throwing more effing money at broken systems.
First of all, define "Internet". Am I paying for exchanging TCP packets? Does that mean that I have to pay an Internet tax for my LAN?
Can they charge money for a service they're not providing? I mean, "the internet" is a result of thousands of computers connected together. And AFAIK, nobody "owns" the internet.
Who should get the money, anyways? And would the money be used to improve the internet?
Has anyone ever bought anything from some of the larger online merchants? Most of them do, in fact, collect sales taxes. Many of them book the sales at point of delivery. I.E. if Best Buy ships you a new DVD player and you take delivery of it in NJ, the store closest to you adds the sales to it's numbers and pays the tax, then you are charged the 6% sales tax.
Even if lawmakers decided to impose additional taxes above and beyond traditional sales taxes on internet commerce, it would only drive the business back into traditional retail channels where standard sales taxes apply.
Taxes only increase government revenues when the general economy benefits. All forms of taxes are designed this way; property taxes, sales taxes, income taxes only increase as the underlying economics increase. Lawmakers trying to boost revenues during a recession are delusional about the intended results.
-ted
"So Long, budget surplus!"
There never was a budget surplus. There was never a year during Clinton's two terms when the national debt was less at the end of the year than at the start. The "budget surplus" was a scam from start to finish, but obviously many Americans were dumb enough to be taken in by it.
The S&H charge when ordering from online only stores is nothing more than a relic of when the stock came off the store floor. Now, most items never see a B&M retail outlet. B&M don't tack on a S&H charge that they obviously incur in delivering the product to the store. It's called the cost of doing business. Etailers itemize S&H b/c they can get away with it.
Do you really think that it costs Amazon more in S&H charge to deliver a book to your house than it costs Barnes & Nobles? B&N has to deliver the items from their warehouses, stock the shelves, etc. Amazon ships stuff to the warehouse. When you order, they they don't ship it right away with free shipping. Instead, they probably move items by the truckload to enable them to send things in smaller batches.
Plus, that S&H charge is often a well-provided service. It's a lot easier to get it delivered to my door than to make a special trip to buy something. Really heavy stuff (TVs) cost a lot to ship, so then it makes sense to buy it in person. But bottom line, basic S&H charges should be included in the cost of goods.
It seems to me that something like this can only serve to hurt an already weak economy. Seems like a bad idea to ask people to pay more for online goods when people are already spending very little.
Just a thought.
- Sighuh?
Does this remind anyone of that goofy President of the United States father? "No New Taxes" and what does Bush Sr. go and do, more taxes of course.
And while we are at let's tax the insanely rich, I mean come on nobody needs more than a 640k a year....
If what you are reading sounds funny, or sarcastic, lame, or stupid
it is because it is supposed to be. just laugh
We can also talk about the sales tax being a regressive tax. Much like tariffs, it eats a greater percentage of income as total income decreases. One way that the middle class copes now is save on sales tax. The middle class cannot launder money through off shore credit card accounts. The middle class cannot launder retirement savings through dummy corporations. The only thing they can do is try to save a bit of money by buying out of state.
The great U.S.A., which has traditionally targeted the middle class for tax complience, is not actively trying to go after the money launderers that actually have massive amounts of disposable income. Rather, they go after the middle class and ask for an additional cut of the tiny amount of cash that is left after food, shelter, and clothes. I don't know about you, but if I have to pay an additional 10% on mail order purchases, I may just decide to test my luck at the thrift store instead, or probably go without.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
as someone that is just starting into online sales, am i expected to collect taxes for the united states now? even though i am not a citizen and not even in the country? furthermore, am i going to have to pay state taxes on the goods i order online from sites in the states?
if so, why would i bother? i'll go back to smuggling.
Similarily, as the UK is paying for 3G subscriptions as written in this article, perhaps, rather than taxing all business on the web, they focus instead on taxing just a certain sector, such as 'adult sites'. The libido of men doesn't move a whole lot alongside the economy, as far as I can tell (except possibly inversely, which is double-plus-good in this case), and I know that most adult sites make enormous profits. The rest of the internet economy could go on blistfully, while the adult sector earns slightly less money, while the government collects a lot from the tax. Of course, this could run into problems, as lots of stuff is hosted outside of the USA, but as far as I can tell that can only lead to a reduction in the amount of stuff that people are 'banned' from doing in the US.
Well, okay, it wasn't a great thought, but it was a thought, okay? The really sad thing is if they legalized kiddie pr0n and then took 50% of profits from that they'd probably make a TON of money. ~_~
[insert witty comment here]
...Internet taxes == tax on the horny.
Four fifths of all our troubles in this life would disappear if we would just sit down and keep still. -C. Coolidge
Who spends money online?: Middle to Upper class.
Who pays property taxes?: Middle to Upper class (people who OWN property).
Who pays sales tax?: Middle to Upper class (people who BUY stuff).
The lower class doesn't make enough to buy stuff and doesn't make enough to be taxes much. That is why the top 10% of income earners in the country pay 80% of all taxes.
Giving money to the government is like giving booze to an alcoholic - it might SEEM like you are being kind, but you are not.
www.eFax.com are spammers
They could call it .tax
I am not a number! I am a man! And don't you
e-Commerce only accounts for about 1% of total retail sales -- see department of commerce: http://www.census.gov/mrts/www/current.html
Traditional catalog mail/phone order sales account for about 10% (I haven't found a definitive internet source for this -- the articles I've found are about a year old, and may include e-Commerce too).
If these are not taxed as well -- and they have a powerful existing lobby much stronger than even Amazon, let alone Ma & Pa Website -- it would be a blatant disregard of the economics, let alone the legality of taxing one kind of interstate commerce over another.
If they can tax all mail/phone sales, then there's a significant income source. Taxing just the internetters is only going to drive them out of business, while those Brick & Mortars already out there with catalogs will endure. They'll just encourage people to call after browsing.
Design for Use, not Construction!
You can disagree with the tax cut, but it has absolutely nothing to do with state budget shortfalls.
This is also the most anti-coporate corruption idea proposed by a president in recent memory. It's effectively a tax increase for corporations and a tax break for people and investors.
Someone doesn't realize how much of state funding is federal grants, or how much is spent on unfunded federal mandates (which could be funded, for example, if you didn't have the $674 Billion Tax Cut).
Guess you wern't as informed as you thought.
paintball
I don't get this. Why do they keep raising the taxes in the interest of "the economy" ? What does raising the taxes do?
If you start to tax internet purchases, people will gradually stop buying things online. If I live 10 miles from the state line and I know that my neighboring state doesn't have gas taxes, where will I go to fill up my truck? I'll go to the place with none of these goddamned taxes. If it's 30 miles away then I'll bring a gas can or three so that I don't have to come back the next time I need a fill-up.
Raising the taxes (or making new ones) will not give the government more money, it will just give the people more of a headache and give them one more reason to take their business elsewhere, or at least to avoid the condition which is being taxed. If you make purchasing an item more difficult or expensive, people will simply NOT buy it unless it's a necessity; they'll find another way.
I was talking to my uncle the other day about neat little legal methods of tax evasion. When he worked for a steel mill in Pennsylvania as a trucker, the county implemented this ghetto-ass "warehouse inventory tax" or some bullshit. They said you'd be taxed based upon how much stuff you had in inventory in your warehouse at the end of the month. (This applied to grocery stores as well, and he told me that he saw numerous stores in the county close down because they couldn't pay the tax. This is dozens of jobs lost due to taxes.. yay taxes!) At the company my uncle worked for, their way around the tax was to do all shipments at two days before the end of the month, as you cannot tax what isn't in inventory... all the steel was out on the road, warehouse was empty, no taxes being paid. simple as that.
I already illustrated above with cheap gas, and now with the steel. How many more examples are needed, before a -taxmaker- is going to understand? For the number of people who are going to get pissed off and stop buying online once online buying starts being taxed, do you think they'll end up with a number of joe schmucks who're willing to pay the tax to compensate for the loss?
I think that, in this crappy economical condition we've got going, RAISING the prices in any way shape or form is really one of the more idiotic things that should be done.
Instead, I think governors need to stop buying $900 toilet seats and senators need to stop putting $60,000 cars on the government bankroll. I'm sure there are ways we can come up with some money somewhere that does NOT involve pissing off the public. The outgoing governor of Illinois (I think it's Illinois) just commuted the sentences of all death row inmates. Now, in Illinois, death row is empty. 156 death sentences became 152 life sentences and 4 40-to-life sentences. While this is a good humanitarian thing to do, and he acknowledged that our system(s) are flawed and need changing, he also took a bunch of people that we (as the taxpayers) would not have to feed, clothe, and keep warm by this time next year, and he ensured that our money will now go to feed, clothe, and keep warm a bunch of people whose death warrants were already signed. You wouldn't think it initially, but keeping an inmate ALIVE in prison is rather expensive.
So while it was a nice gesture on the governor's part, it was also costly. If everything boils down to the great American buck (as I know it does) then the only justification for doing anything should be because it's the CHEAPEST, not because it's the most MORAL. If everybody made sure the buck came first, I bet the economy wouldn't be in the position it's in. (I also bet nobody in a political office would have a $900 toilet seat.)
Reinvent the wheel only at either a lower cost, greater effectiveness, or your own personal enrichment and satisfaction.
Let me tell you how it will be
There's one for you, nineteen for me
'Cause I'm the taxman
Yeah, I'm the taxman
Should five percent appear too small
Be thankful I don't take it all
'Cause I'm the taxman
Yeah, I'm the taxman
(If you drive a car car) I'll tax the street
(If you try to sit sit) I'll tax your seat
(If you get too cold cold) I'll tax the heat
(If you take a walk walk) I'll tax your feet
Taxman!
'Cause I'm the taxman
Yeah, I'm the taxman
Don't ask me what I want it for
(Ah, ah, Mr. Wilson)
If you don't want to pay some more
(Ah, ah, Mr. Heath)
'Cause I'm the taxman
Yeah, I'm the taxman
Now my advise for those who die
(Taxman!)
Declare the pennies on your eyes
(Taxman!)
'Cause I'm the taxman
Yeah, I'm the taxman
And you're working for no one, but me (Taxman!)
and when the govt. borrows, that puts them in competition with me for borrowing that money. If I want to buy a house or car, and the govt. wants to buy guns and airplanes to use in Iraq or North Korea, we're both borrowers. If there's only so much money available that means that according to supply and demand, the COST for borrowing that money goes up. In other words, we both pay a higher interest rate. This means that the govt. has to either borrow more money or raise taxes to make the payments (something like 18-20% of the federal budget goes just to pay the INTEREST on the loans the U.S. already has (AKA the deficit)). It means that my monthly mortgage payments go up (if I can still afford to buy, that is). It also means that I have a larger mortgage deduction which means that I pay less income tax which forces the federal govt. to borrow more $$ to pay for next year's guns and airplanes. See how it's interrelated? It isn't an easy problem that has an easy solution. The only way to really help the deficit is for the federal govt. to SPEND LESS MONEY.
"If you let me write $50 billion a year of hot checks, I'll give you the illusion of prosperity too!" - Lloyd Bentsen in a 1984 vice presidential debate against Dan Quayle
Liberal politicians and activists DO want more taxes. They want to tax everyone (especially the rich) so that all the money goes to them and then everyone is indebted to them to get social services. By taking our money, they take our power to do for ourselves.
That's why they were such proponants of wellfare for so many decades. It made entire generations of families poor, uneducated and totally dependant on their political party.
Until now, the internet effectively enjoyed a massive tax break, which was a huge and foolish intrusion of the government into the private sector. This break did not actually help its long-term growth, either. It attracted more money to the internet, yes, and gave companies more cash to work with; but those gains were artifical, since cutting taxes did not significently help with any of the other factors that limited its growth.
Given time, the market would have brought that much money into the internet anyway; but the government intefered with that process. By not taxing internet companies (or by taxing virtually everything else, depending on how you look at it) it contributed to the internet bust and ended up damaging the market that it was trying to prop up.
"And besides, I'm already paying taxes on a lot of my internet commerce."
;))
Whaaaaaaaaaaaa???
I figure $$$$$exyGal must live in a state that has a lot of internet retailers, maybe California or New York. Or else she actually fills in how much she's supposed to pay in use tax each year on the state tax form! (Much like I do
The net is going to be taxed, plain and simple, no matter how much we all belly ache over it. It won't be a bad thing either. Although I'm by no means a fan of being taxed, they are necessary. Internet commerce is still commerce, and commerce is taxed.
I do take exception to the terms fragile economy when used to describe the Internet. Sure, some of the infrastructure jobs and that sector may be hurting, but online spending is up. And going up. These transactions, if taxed would do a great deal to help states if a system is implemented.
-- jimmycarter
The hidden Easter Egg in Smirky's big tax reduction package: force states to raise taxes, including collecting tax on Internet transactions. Gee, tax reduction seemed so simple- just like foreign policy. Oops.
I've never been so motivated to do something to affect a change of government (in the US, not Iraq). Never been so damn scared in my life since the Reichstag fire, er, since 9.11.
Wake up America, before it's too late.
Damn the damned government.
is the same thing. but heck, i already pay taxes on my purchases in MA. i think the basis is determining whether theocmpany has a substantial presence in the state.
The war with islam is a war on the beast
The war on terror is a war for peace
I'm all for any sales tax they want to put on anything...IF they get rid of income tax. I'm tired of being taxed for making money, and then taxed for spending it. It should be one, or the other, not both, and I think sales tax is a lot better because it's a lot easier to enforce...nobody reports all of their tips as a waiter, kids washing cars don't report their income (in general)...just go to an all sales tax system. The poor would benefit, because the ones paying the majority of the taxes would be the rich people buying mercedes' and yachts! You could even make it MORE beneficial by taking the tax off life's necessities (food, water, home, clothes).
Chris
It may be inevitable that products purchased on the net will be taxed someday.
Products purchased on the Internet are taxed right now. Businesses must pay varying amounts to various governments in order to operate. You, in turn, pay for this when you purchase a product. In essence, the taxes levied on businesses end up being paid by you. Should you ever begin to appreciate the complexity and magnitude of these taxes, including the various means to increase/decrease or even get out of them, a paltry 5% (or whatever) sales tax isn't all that big of a deal. The governments' largest monetary gain (and your loss) is not sales tax -- it is the traditional means of taxing a business. This law won't change it. It may, however, help to keep you from figuring out just how much of your money is really being taxed.
"God is a comedian playing to an audience too afraid to laugh." -Voltaire
If there was a surplus, why should you be any happier about it? A surplus means the federal government is taking more of your money than it needs. Of course, that's the case in virtually any circumstance, but a surplus puts a flood light on it.
This would only affect spammers in America, soon there will be a growing gap between spammers in America and foreign Spammers. Don't let this happen, I elect that we should support all the spammers in America, and make the United States the capital of Spam!!!
~~~
Click here, you know you wanna!
DivX at 11.
Sorry, but I fail to see what role state governments have in the "upkeep and maintenance" of the internet. Seems to me that task is shouldered by individuals and companies, not the government.
Hey, I have an idea - let's just tax folks who can't or don't know how to buy online! Let's tax the ignorant people - they're all black anyway.
I'll just buy online from another country. No state tax in (China, Mexico, India, wherever) and when everyone else follows suit all of our consumer dollars will be flowing out of the country. That means no tax dollars for the states, no jobs in this country for online retailer employees, and we can sink into a depression because our state fucking governments mismanaged our fucking tax dollars to begin with and that's how they got into a deficit to begin with.
Hell if I was a company in another country, I would be selling the shit out of the notion that people could buy stuff with no tax, and I would sell at as close to margin as possible just to put American online retailers out of business. Once that was accomplished I could safely bump up the prices again because I wouldn't have any competition.
The federal government would be happy to charge spammers a bulk rate for email delivery, and you about ten times as much. Spam should be outlawed and email needs no taxing. You govenment's greed is never to your advantage and must be checked at each election.
Friends don't help friends install M$ junk.
Considering that they had to slash their discounts just to stay afloat. I searched two cds and found that I could save 32% on one and 0% on the other. And has the company even hit the black for a full fiscal year yet?
Sure, we can say "fuck 'em" but usually crushing a fledgeling industry (especially after the backlash of the Dot-bomb and now this Recession) isn't in our best interests.
And I especially like how they say this will solve the States' budget woes. Heh, Michigan alone has a $500 million dollar deficit. Do they really think that much internet merchandise is heading out of state to make up for that (roughly $10 billion in sales would be needed if a 5% internet sales tax was enforced)? Hell, even a fraction of that would still require a ridiculous amount of sales anyway.
And even then, who the hell is going to enforce it? What about ebay? Are they going to raid Paypal.com and demand that they turn over their records so the member states can bill people accordingly? How much bureacracy is that going to cost? I think they might be playing around with 1998 numbers here. Pfff. Try again.
What is music when you despise all sound?
If the income tax was abolished, people wouldn't give a darn about these piddling little sales tax rates. But the income/fica/ss tax is so huge these days when combined with the sales and property taxes that they can barely afford to pay an increase of any kind.
The American is overtaxed just as much as the European- he's just screwed in different areas.
I think it's a big mistake at this point to specifically tax internet sales. I purchase goods off the internet because they're cheaper than in retail stores. The prices are usually just barely cheaper after shipping. However, they are cheap enough to more than offset the delay in receiving the product.
Since I'm currently in New York State (which has outrageous taxes, at least compared to Idaho), I am often taxed for internet purchaes. For example, ordering from CDNow (which I did before they were 'swallowed' *cough cough* by Amazon.com it was about the same price ordering from them (after shipping and taxes) as buying the same $18-$20 CD from a retailer. It simply wasn't cost effective. I only continued because I don't have a car to drive to stores :(. If they start taxing internet sales, it won't be worth waiting a week to get a product that I'll end up paying full retail for. It will destroy online stores. I for one won't buy from them, because it won't be cost-effective for me.
<soapbox>
IMHO, states should think about eliminating unnecessary government programs instead of looking for more revenue. That's the best in the long run. It ensures a fiscially responsible government that isn't bloated. It also allows private companies (who can do the jobs for cheaper) to save money and provide better services.
</soapbox>
neurostarIt's called income tax and everyone pays it, including your ISP, and it does pay for infrasturcture and civil defense. Many states also have income taxes.
Friends don't help friends install M$ junk.
Nobody under the age of 18 should have to pay sales tax either. Even if a minor lives in Ohio and buys something in Ohio, its still going to a government for which he has no representation in.
The masses are the crack whores of religion.
Then those who currently may not even pay any income taxes at all[the poor], suddenly can't eat anymore because you made the payments on their car which they need to get to work 30% higher. Gee, what a great idea!
-- 'The' Lord and Master Bitman On High, Master Of All
Seriously. Why should government become a larger and larger part of the economy? Sure government has to grow, grow as the economy grows, but why is it a larger and larger part of GDP. Why? Once a spending program begins its inertia is HUGE, it never goes away.
a small paste from their intro page:
Simultaneous Budget Deficits/Shortfalls AND Financial Surpluses
This is the most deceiving topic that governments, politicians, and the news media have conveyed to the public about governmental financial matters. In realty, a government can simultaneously have a budget shortfall and a financial surplus of the taxpayers' money.
A budget is an estimate of the amount of money to be received and the amounts to be spent for various purposes in a given time. It is a planning and monitoring document. It matches revenues (income) and expenditures (expenses) for a given period of time which is usually one year for most governments. It does NOT demonstrate the financial condition of a government.
You continually hear the phrase "budget shortfall" or "budget deficit." What this means is that projected (planned) expenditures will probably exceed projected (planned) revenues. When this happens, governments immediately want to raise taxes and/or reduce services regardless of the financial condition of the government. It works every time.
--good luck, %*()^# the bastages, and remember, any government's first job is to perpetuate itself and it's human members as an organization. It's an "us versus them" situation, with those guys holding the cards and with their mercenaries who insist they are correct and you are wrong, in every case. There is NO incentive for any of them to do anything that will jeopardize their own check, at best that is electioneering rhetoric, and that's it. The "for the peepuls" nonsense is job 789 with them.
Frankly anyone who know anything realizes that an "Internet tax" would be hell for governments to implement and regulate.
People already have to pay taxes for things bought on the Internet, and do pay them if they are imported from another country. Customs looks at the sticker on the package, calculates the duty and tax, charges a fee for handling, and presto - Internet Tax.
This is not new stuff to anyone who sells on eBay for example.
Saskboy's blog is good. 9 out of 10 dentists agree.
It seems that many people think that the reason people buy things over the internet is that they can get it "tax-free" (same goes for catalog sales), but it seems that it you look at the shipping charges for most mailorder/internet sales, they'd exceed the sales tax you'd pay if you bought it at a store in your home state (if your state has no sales tax, then shipping costs become a potential advantage for the local Mall store -- assuming that the states don't load up the tax burdens in other ways for merchants). In reality, mailorder/internet sales increase competition between merchants (by increasing choice for consumers), tending to lower prices. It also forces state governments to be more aware of the effects policy has on local industries, because the retailers have to compete with other retailers in other states (which may not have as high a per-capita tax burden). While forcing collection of "use taxes" for out-of-state buyers may seem to boost the competitive position of local retailers, it also adds additional administrative costs to each retailer's bottom line (so now we have a hidden tax on retailers to become tax collectors for other states!).
Actually, every proposal I've seen exempts the first $30k-$35k from sales tax each year.
I have a few situations which US lawmakers may need to look at.
1.If I (a foreign national) visit the US and buy goods subject to sales tax, when I leave the country I am able to claim this sales tax back. How does this apply in this situation when I do not physically arrive in the US and I do not physically leave?
2. I (hypothetically) own an e-commerce business based in Australia. If I sell goods to a customer in say, California, will I be required to charge them a Californian sales tax? If so, how will the state of California ensure that I pay the tax to them. They have no recourse through the californian courts as I have no material resources in California and any judgement against me would be ineffectual. They have no legal recourse under Australian law as Californian legislation is overidden by Australian federal or state(NSW for the sake of argument) law.
3. I reside in Australia. I use my credit card to buy a book online at Amazon.com. I ask for the book to be sent to the UK. As Amazon has UK offices they elect to send stock from there rather than ship the book across from the US. Who gets to levy the taxes here? The purchaser is in Australia, the vendor is in the US (I forget which state) while the goods are in the UK.
It seems to me that this is a mad grab to try and get money which the states feel they are losing out on. My personal feeling is that the entire thing is unworkable and that the effort will not be worth the end result.
You call me a pedant? I prefer the term "correct"
With a bounty of, say, 50% of the seized assets used in, or gained as a result of said criminal activity, it could be a VERY nice living (evil grin)
Why shouldn't we be charged sales tax on internet purchases?
For a better question, why *should* we have tax on internet purchases? For in-state purchases only, I can see it as (somewhat) justified. Otherwise, this gets into a large mess with that whole "No taxation without representation" thing. Tell me, how does my tax money going to another state enhance my representation in my own state's government?
Of course, I agree with you that we should not have any state-level sales tax in the first place. A number of states get by just fine without it, and those with the highest sales taxes tend to get the most tourists (such as NY). Explain to me how heavily taxing tourism has ANYTHING to do with representation in government? Yeah, I harp on that point a bit, but we fought our very first WAR over it. If we've recanted our stance on taxation, perhaps we should just beg the British to take us back? Their economy seems a hell of a lot better than our own, at the moment...
Finally, this will kill on-line purchasing, but not have any of the desired effects, for one simple reason - I most certainly would *NOT* pay taxes on an on-line purchase when I can simply pick up the phone and order the same thing, from the same company, as "mail order", without the taxes.
First off, some are saying they will force retailers to pay the tax to their state, others say they want to force the retailer to pay the tax to the buyers state. Bwaaa hahahha!
Second, the federal exemption for internet sales tax doesn't run out until 2004. I admit, they can speed that one up if they pull for it.
Third, and last, is that this crosses state lines. Do you think states are going to sit down and divide the pie fairly?
HAHAHAHAHAHAHAHAHAHAH! *gasp* *gulp*
HAHAHAHAHAHAHAHAHAHAHAHAHA *gasp* *choke*
HAHAHAHAHAHAHAHAHAHAHAHAHAH!!!! *gasp* *choke* *chortle* *THUD!*
Quick, some one show Michael Powell how to use e-bay!
*Boat tax, 6th paragraph
Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves.
States had been pushing for internet sales tax for some time now...but now everybody's got a bee in their bonnet to see it occur. States feel that they are losing big bucks now because people are ordering online (though their calculations are only thinking about the internet sales going to their state, not necessarily the opportunity cost of jobs and stuff that may be created in their state because of internet commerce.)
Thing is, states have screwed themselves with progressive income taxes. Sales taxes do go up and down with consumption (obviously) but not as severely as income taxes. California for instance has this really progressive system where the top 10% of income earners are paying for some 75% of California government. So, the economy takes a tumble, income generally does go down...but the top 10% of income earnerrs have *huge* decreases in income, so suddenly California has a $25 billion shortfall. They can't increase the progressivity of the tax structure--you're not gonna get much more out of people who's income's dropping severely, so all ya can do is widen the tax base...meaning increase income taxes for median earners, or sales tax, or find new tax sources. I believe states are starting to understand how easy it is to screw the pooch raw with progressive income taxes (note that the states that have blown their budgets the most are those with income taxes, CA, OR, OH, IL, NY, whereas non-income tax states like TN, FL, NH, TX, are not looking at such bad looking budgets. Those states have much more reliable income streams from property taxes and/or sales taxes.)
You still buy CD's?
LOL!
Yeah. I like the artwork. And I also like to support bands I really like.
Unless it's a band I really like, I first download some songs to see if they're good. And if they're good, I'll buy the album, just to support the band. And if it's not good enough to buy, the songs aren't worth the space they take up on my HDD. So they get deleted.
neurostarYou may recall, we fought a revolution over that, two-hundred-odd years ago. . .
George W. Bush is a dumbass. You really think 9/11 would have happened if Gore won?
I see the taxes eventually ending up going both ways. First there is the originating state sales tax, then as it crosses a border, a tarrif of some sort will be applied by the destination state. That way, the sales state captures taxes for a sale and the destination state captures tax for what is currently, a "lost sale".
The tarrifs places on products coming into the country, say Canada, I wonder if they'll be even more heavily taxed thus negating the cost savings.
It almost sounds like not only the issue of lost revenue is compelling the movement, but just as much, protectionist fears.
Right now what I think our economies problem is that the technology industry is what powers it. Now, before you all get mad, hear me out. The reason this hurts our economy is because all the majority of jobs that exist require some degree of advanced education. The industry is very competitive, thus, and the jobs are very hard to get. This results in many people who don't have tech skills not being able to get jobs, and many people with tech skills losing jobs to people with better skills, or automated programs and the like.
Now, how do you solve this? If you create more jobs you help out those well-educated people, but that doesn't make that much of a difference. If you educate more people, you still have a bunch of educated people with no jobs. I wish I had an idea on how to solve this, but I don't. What do you guys think?
OK, shopping online is convenient, but the big draw for many is that without tax a lot of things are cheaper. Factor in shipping and and a tax. And the cost might become prohibitive. Really bad for some smaller e-commerce sites. I'll use your bandwith to look up what I want and then go pick it up at a local store cause then I could have it same day.
-- taking over the world, we are.
They tax it when you make it, they tax it when you spend it, they tax you to live in your house, they tax your phone line, cable and cell phone. Why the hell should internet sales be exempt. Might as well just give it all to the basta**s and get in line to eat 3 times a day and to get a place to sleep.
I said to be of good cheer, not of irrational criticism.
Yes, it is true. The United States is a corporation which incorporated in Costa Rica and their borders are within Washington D.C. The United States offers services; these services are initiated by contract. If you do not agree to them, then you retain your sovereignty as one of many States. Being a private company, the United States shares the same trates as a Church; it dictated laws and morality by contract. Regardless of morality, the regulation imposed upon you is either granted by contract or is not constitutional.
Speaking as Jesus Christ's advocate, give them your money because you participate in their services. Give them all your money and they have no interests in you. Speaking in my own pesona, association of your assets with an artificial entity created within their borders, originating from an affirmation in th form of a birst certificate to provide constructive notice for creation of such an artificial entity, the Untied States is the owner and administrator of all property and effects you associate with the name on your birth certificate or Social Security Trust Fund relative to your benefit of participating in the use of Federal Reserve Notes.
This is not theory, this is administrative procedure of a corporation that operates under Tort Law, Contract Law, Uniform Commercial Law, and honors such. If you disagree with their administrative goals, I suggest you separate from them and be sovereign as was declared 200 years ago as the many states that united together to be beneficiaries as "We, The People."
Yes, many people have shit their pants...including me. I am still having a Good(TM) day.
But I'm sure you already Gnu that.
When I can vote from my comp, than we can talk
Does anyone know how the taxes will be collected? That is, who pays them and how will that be enforced? It's reasonable that the state in which the delivery is made should get the sales tax but how is payment enforced? How does Arizona, for instance, know that something was shipped from a distribution center in California to an address in Arizona? What if the shipment is from another country? What's to prevent a company from collecting taxes and not distributing them? It looks like a nightmare of trouble to me.
Nate
Interstate taxes are unconstitutional.
My solution would be to do away with all taxes except income and perhaps property and just increase those. Make it simple!
I live in a state that has use taxes. I've paid them on my tax form in the correct spot, but every year they claim some sort of error and add that money back to my refund. ???? The bureaucrats seem to have no clue!
Maybe they are afraid what they're doing is illegal? I know this state has a fedral IRS processing center, but the IRS has everyone in this state ship their forms somewhere else. My only guess is the taliban-like government in this state was caught doing some crooked things.
I just hope I can scrape enough money together to get out of here someday...
did NOT collect at least $77,500 in sales taxes
The company you work for is suppose to pay a use tax for those online purchases. How is the state going to know if you bought those computers? Since a computer is a deductable item, if your company attempts to "write off" the said computer systems on their federal and state income tax than they will also be required to pay the use tax.
The proposal put forth obviously cover all interstate transactions not just internet commerce - I thought this was obvious.
The reason states want this is because they're being influenced by B&M stores. B&M stores apparently think they're missing out on a lot of customers JUST because there is no sales tax on the internet.
Sorry guys, that isn't why I'm not shopping as much at B&Ms... Chances are, the cheapest you'll find the product you're looking for is on the internet. If B&Ms had prices like I find on the internet, I'd buy there.
Shipping and handling doesn't really make up for the sales tax... S&H on a $50 game could be anywhere from free to $2 (overnight) and sales tax would be ~$3.50 depending on your state.
The only reason to shop at B&M stores for the most part is the convenience. Try the product, hold the product, go home with it THAT VERY day. No need to wait around for product shipments.
Shopping at B&M and on internet sites have advantages and disadvantages that pretty much cancel out. Don't destroy internet shopping with a sales tax!
the byproduct of years of oppression by the white man
Nice idea, but how do you regulate it? So my spam now says 'in accordance with US SpamTax(tm) Law' instead of 'click here to unsubscribe'. Do I forward all my spam to some agency who then track the spammers down?
The technical solution needs to be developed to support this... and that's going to be tricky. I don't know much about alternatives to SMTP but I do know it's very pervasive... until you can solve the problem of accurately tracking spam mail, taxing it will be impossible.
If you can't see this, click here to enable sigs.
Somebody doesn't know the difference between state and federal taxes,
It's obvious to me that YOU don't understand how they're linked. Federal Adjusted Gross Income is used by most states to figure out a person's state income (and ultimately the level of state income tax they pay). To the extent that any federal tax bills reduce the amount of AGI reported on your 1040, the states will either have to raise tax rates to recoup that or suck it up and cut services.
The Legislature likely will consider a bill in the coming session that would require Oklahoma's Internet companies to change the way they charge taxes on sales made in the state.
Like another bill considered a year ago, this one would require Internet sellers to compute the sales tax based on their locations rather than the buyers'.
This is from the second article for the state of OK. What a great way to slit your own thoat. This will effectively discourage any high tech, non-polluting, job creating, revenue generating business from your state.
My wife has a modest internet hot sauce store. She generates over 100k in revenue and hires an employee. The employee pays state and local taxes. We pay an inventory tax, a use tax on equipment used to run the business, property tax, state income tax, commercial vehicle tax, etc. If Idaho implemented such a tax we would close up shop or move to Montana or Nevada and the state of Idaho would lose.
Why don't states gain revenue through the ownership and profitable operation of businesses; perhaps purchasing successful ones or starting competitors to them? This would supply revenue without ANY percieved cost to consumers. I would think the ideal situations for this would be businesses that already enjoy limited need to add new services, like utilities and banks. A slight variation on this has been seen in some "Idiot Pays" laws... if you drive yourself into a flooded river, you pay the costs of the rescue, so why not tack on a 20% markup and call it profit?
In fact, the primary actions I've seen are completely to the contrary: state constitutions forbidding the state from competing with private businesses.
And BTW, since nobody said it...
1. Tax Internet Sales
2. ???
3. Profit!
It's just like a fascist dictatorship, without the punctual rail service!
US Military Budget this year is something like $780 billion US dollars.
m l
/. Actual facts don't matter.
2002 US military budget is less than 1/2 of that. $342.3 billion.
http://www.cdi.org/issues/budget/fy'02/index.ht
Let's not get silly with our bitching, OK?
Insightful, my ass. But hey...this is
The government doesn't have the right to license you to spam me. It cannot rightly issue you a license to trespass upon my mail server and steal its resources for your advertisements ... any more than it can issue you a license to burgle my house, joyride in my car, or pick my pocket.
Theft is made illegal because it is wrong -- it's not wrong just because it's illegal. Likewise, spamming is wrong even in jurisdictions where it is not clearly illegal in statute. Government, in its position as an balancer and protector of rights, does not thereby have the authority to collude with some wrongdoers and agree not to enforce claims against them. We call that "corruption" when a police force won't investigate crimes by someone who is paying them off -- and that is what "spam licensing" would be, too.
That didn't shed light on anything. Who the hell is Filene anyways? A well-known economist? Anyone that works for their money isn't 'taking' it at all. They are earning it. Renting out their time and skills to an employer for a wage, just like you pay for city/state/governmental services with your tax money. If those government bodies have trouble handling their money, that shouldn't be my problem.
Require something like:
All unsolicited commercial email must be on an direct and specific opt-in basis only
Or something similar. You can fine tune it.
"It is a greater offense to steal men's labor, than their clothes"
Go out and form a party for the next election.
Call it the "No More Mandatory Votes" party. Make it your platform to abolish the mandatory vote, then call another election to elect a real candidate.
There you go. Democracy in the works.
If you could be told what you can see or read, then it follows that you could be told what to say or think - BoC
Exactly _what_ part of the internet is paid for by the government, and if there is a part of it still funded by the government, could America live without that PDP-11 and 300 baud modem?
If you could be told what you can see or read, then it follows that you could be told what to say or think - BoC
It wouldn't really affect me all that much. Except around the holidays which is about the only time when I would choose to order online over a local purchase. The majority of the time I buy from a local vendors after checking out their prices on their web site then picking up the products at their `will call' desk. Establishing some sort of relationship with vendors seems to work out well and they'll keep me informed of price reductions that are about to occur, new product releases (or sunsets) they've heard about, etc. The internet still plays an important part of my purchasing as I visit the web sites of my preferred vendors and their local competitors to make sure I'm getting a good deal. They know I do this (um, you do know this, eh guys?) just like the salecritter at Best Buy know his customers have done pricing at Circuit City and other stores.
Now... if they attempt to tax the internet based on the packets I generate/consume while I'm visiting commercial sites to do some `window shopping', then I'll be hopping mad.
Firstly, the administrative costs of Internet Sales Taxes would eat up any profits involved, unless it were (a) strictly Federal or (b) so staggerinly high that it would wipe-out the online sales market.
Secondly, sales tax is a horrible way to raise money anyway. Of the three forms of taxation (income, property, sales aka "outgo"), it is the most regressive (meaning impacts the middle class more than the upper class and the lower class more than the middle class). A sales tax discourages purchasing. Sales tax HURTS the economy more than any other form of taxation.
If the states wanted to raise taxes to get more money, they should be looking at the income tax, specifically at the upper-end. Income tax may reduce spending (since people have less to spend), but unlike sales tax it does not also discourage spending as well. If taxation is the only answer, then at least tax the right thing! Sales tax only hurts the economy more.
"But my income tax is too high already!" Only because the current federal income tax system (state income tax is typically around 2-3% compared to the up to 33% federal) is effectively regressive. If we didn't give upper-class income brackets all sorts of effective loopholes to reduce their income (eg, Congress just declared the capital gains tax to be zero, eliminating BILLIONS of dollars of federal income, and returning money to the people in the country who are in the least need of additional cash), because, and this is the important part, different income levels tend to get their income from different sources, and those sources are taxed differently.
You want to raise more money through taxes? Fine. All income from any source whatsoever is treated the same. Wage, stock options, capital gains, everything. Then impose a staggered, progressive income tax on it, without any loopholes or exemptions or "business deductables". Then drop the percentage rate from where it is now by, say, 25%.
Then eliminate all sales tax, Internet or otherwise.
Not only will 90% of the population have MORE money to spend (stimulating the economy), it will reduce the cost of operations for the IRS and for state tax agencies (reducing the budget), and still give the government (at various levels) more money to play with to fund social programs or invasions of other countries (whichever they're in the mood for this week).
Internet Sales Tax? No. Let's not have an Internet sales tax. Let's not have a sales tax at all. There are far less damaging ways for governments to raise money, and they involve smaller (and cheaper) armies of accountants to do it.
--GrouchoMarx
Card-carrying member of the EFF, FSF, and ACLU. Are you?
With mail order, the seller enforces the sales tax if it has a business location within the state. Otherwise its technically up to the buyer to report the sales tax to the state.
There is no such thing as tax free catalog sales or internet sales. Its just that no one ever reports the taxes their supposed to unless its a big ticked item that they need to register anyway (car, etc.).
So for example if Borders was going to merger their internet and brick & mortar operations into a single business entity (maybe they are, this is just an example), then they'd have to charge sales tax on every trans action. That's why many internet operations are seperate business entities from their main company.
What this proposal is all about is the fact that many legislators think that because the internet is all technology driven (duh!) that its easy to whip up a whiz bang tax feature and *blamo* instant tax collection for the state that used to go unregulated.
---
"Don't anthropomorphize computers. They hate that."
Here in Canada, when I buy online services in-province - I pay provincial tax. In-country, I pay federal tax. If I order from the US, 75% of the time I pay the tax as it crosses the border (even on used items!) plus border duties, etc.
Over here, I don't think we can be taxed anymore than we are. I also wonder... with free trade, why is there border taxation/duties?
The real question is 'is compulsory taxation moral'? I, and many others, argue that it isn't.
Til they decide to tax it too, then perhaps
we can talk co-op ???
LOL
Peace !
Ex-MislTech
Live from Guantanamo Bay Cuba for 29 more days !!
google "32 trillion offshore needs IRS attention"
The thing is, in the years to come you are going to have to pay more tax then ever before
why you say ?
because GWB latest tax cuts will push the USA 250 trillion dollars into the red (not even counting the cost of the "war on terror"), right now USA is 32 trillion in the red (or $115,322 per man, woman and child) so i hope your kids won't mind paying that back, thats why you see the dollar declining every day as investors realise their money is better invested elsewhere
here is an analysis of USA debt
http://mwhodges.home.att.net/debt.htm
enjoy now so your children can suffer later
whoever owns www.tax.com or www.tax.net or www.tax.org would benefit from more taxes
Well, these laws may well get passed, but the idea of enforcement is insane. Even if the IRS suddenly became technically capable and properly staffed in order to accomplish this this feat (rolflmao), all a company has to do is re-incorporate and find servers offshore (Yes, this is a simplification). Any laws passed will do nothing more than possibly gain (and more likely, lose) votes for politicians trying to look like they are doing something to improve the economy. This is a non-issue, unless you consider driving buisness off-shore a concern.
That's where 90% of the online economy is anyhow.
Build stuff. Stuff that walks, stuff that rolls, whatever.
The benefit of doing business online and paying out the buttocks for shipping is to save the 8.5% we get charged for sales tax where I live. How many people do you think are going to buy products online from me if I have to slam an additional 8.5% onto them. Locals have to pay it simply because they are getting the benefit of having someone local rape them for cash. It's sad, but at least every county plow truck is brand new and there's a metric ton of open space now preserved..... until the county doesn't have enough money to pay of the financing on the plow trucks and up pops a strip mall to cover for it.
If this becomes law, how would the government determine what was actually purchased online?
Wouldn't businesses simply find some kind of loophole like reporting all their sales as mail orders?
That brings me to my next point... that the internet is not a physical place. In this case it is just another communication method, like a phone, or the US Postal Service. If there is a tax placed on items purchased online, there will have to be a tax on everything else.
Contact me for more information on Quixtar if interested.
But this is slashdot. A slashdoter who didn't build his own computer is like a Jedi who didn't build his own lightsaber!
Think about Internet taxation from a state perspective. A state with few e-commerce sites within its borders has a great incentive to tax e-commerce. The tax may result in higher prices online, driving more consumers to buy products at brick-and-mortar stores near their homes, stimulating the state economy. At the same time, the e-commerce retailers that might go out of business are likely to be located in other states, thus resulting it little damage to the local economy. Seems pretty inevitable in a lot of places.
The official number for the Department of Defense for 2003 is $380 billion dollars. (As with all that follows, this number is based on the president's proposed budget for the year. Congress wouldn't dare cut it significantly, though they often add some pork.)
Now that's ridiculous enough. It's a good deal more than we spent during the Cold War, more than any other country on the face of the earth, and several times that of all of our potential enemies combined. Meanwhile, we're slashing funding for social services.
Then there's another $17 billion for nuclear weapons, that politicians have thoughtfully placed under the Department of Energy budget, for a total of $396 billion. (Both of those figures, incidentally, are also from the CDI's website, only for FY 2003).
My suspicion is that the original poster probably got his numbers from the War Resisters League, which puts out a great little flyer called Where Your Income Tax Money Really Goes. Their purpose is not so much to discuss year-to-year policy decisions as to emphasize the degree of the tax burden that is the fault of military spending.
They come up with a total figure of $776 billion for 2003. $437 billion is current military spending, which is the DoD budget, plus DoE nuke programs, plus portions of the budgets for other federal programs which are used in large part for military purposes (CIA, Coast Guard, NASA, FEMA, etc.). Then there's $339 billion in military spending: $57 billion in veterans' benefits and $282 billion in interest on the national debt (80% estimated created by military spending). Neither of those are discretionary from the point of view of the annual budget process, but they are definitely indicative of how runaway military spending increases our tax burden.
None of this, however, is particularly relevant for the original context of this discussion, because sales taxes are state and local, not federal. My personal opinion is that we can solve the whole problem by doing away with most sales taxes, which are regressive, and funding government primarily through a steeply progressive income tax (both personal and corporate).
Red All Over: Rambling Missives from an Aspiring Revolutionary
No, "use tax" means something different, look it up. It is for retailers and such who "use" part of the inventory (for display purposes, etc...)
It seems to me that what is really standing in the way of all of this is a simple agreement over who really "has" the right to tax. Take a for instance; I hop on the computer in Austin Texas. Look up a CD on Amazon (based in Seattle). I then have the CD Shipped to my friend in Brighton England.
Who has "the right" to tax that? You could make a legitimate argument that every city, county, state and country involved in that transaction can claim a peice of the pie. In that case either I or Amazon would be responsible for tracking all of those different agencies and laws and ensuring that everyone gets their share. The case gets even more complex if you start factoring in the fact that both servers and stock are colocated. For all I know the "Amazon.com" that I contacted may be served from somewhere in the midwest, and the CD may have been shipped from some Amazon warehouse in France.
Obviously that would stifle any and all internet commerce. One alternative is a moratorium on all taxation. I disagree with this because it gives Amazon and other online outlets an unfair advantage over their "bricks and mortar" competitors. It also exempts them from paying for the infrastructure that sales taxes are (or should be) spent on, infrastructure that they depend upon.
The problem with the middle ground where some people can tax but not others is that you have to make a convincing argument (or carry a big stick) to explain it. In the past I know that the U.S. Federal government has used its power to regulate interstate commerce as a means to control or "simplify" interstate taxes. I suppose that could be one with internet purhases in the U.S. but when it comes to international purchases thewre's only groups like the World Trade Organization (*Shudder*) or local elements such as NAFTA.
*cial Security is dying. Rivers of red ink like blood. Kreskin. Usenet numbers.
We're fucked!
No service the federal government provides is worth the huge amount of taxes it charges. Defense can be shifted to the states, and the federal government can be abolished. Fuck the federal government!
It would hurt an already depressed market.
Geezus, voodoo economic never really dies, does it?
First off, state (and federal, for that matter) fiscal crises at the moment aren't being caused because of escalating spending (with the significant exception of prisons). Rather, it's because the economy is tanking, so revenues are declining. Also, the corporate welfare that legislators have been passing out over the past few decades are finally catching up with them. (You know, the ones where they give employers tax breaks just in time for them to layoff large numbers of people -- does a great job stimulating the economy, I can assure you.)
Secondly, if you want to put more money into the economy, reducing taxes across the board is a bad way to do it, because you'll mostly wind up putting money in the pockets of the wealthy, who have a low marginal propensity to consume (so the money doesn't wind up going into the economy).
Rather, we should pursue tax policy specifically designed to put money in the hands of working class people, who are much more likely to spend it. The Economic Policy Institute has a great counter-economic stimulus plan which calls for, among other things, a one-time bonus of 3.5% on the first $15,000 of earned wages. Another major stimulus to the economy would be a national single-payer health plan, which would massively cut overhead and red tape in health care, saving billions of dollars for everyone concerned.
Or, to return to the point, we could abolish sales taxes, which not only discourage consumption but are also regressive, with the burden falling unfairly on poor and working-class people. Failing that, however, not applying sales taxes to transactions occuring over the internet creates an unfair business advantage which threatens the vitality of locally-based retail business, which has serious economic and social consequences.
Red All Over: Rambling Missives from an Aspiring Revolutionary
"US Military Budget this year is something like $780 billion US dollars."
1 2. html
BEEEP! I'm sorry, crack monkey, you don't win the microwave!
I know actually spending 90 seconds to bother searching for the information on the Internet is much more labor intensive than your tried and true "smoke some rock and pull the numbers out of my ass" method, but if you had bothered to do any research, you would see that the President's budget for FY2003 tops out at $379 billion."
From:
http://www.whitehouse.gov/omb/budget/fy2003/bud
"To address these needs the President's Budget proposes $369 billion in 2003 for DoD and an additional $10 billion, if needed, to fight the war on terrorism."
With this correction and my handy research tips in hand, I'll let you get back to trying to pull those invisible ants off your face. And remember: Drug abuse and Slashdot just don't mix!
Lawrence Person (lawrencepersonh@gmailh.com (remove all "h"s to mail)
http://www.lawrenceperson.com/
1. wouldn't it be the same thing as mail order, so why isn't there a tax on that? Or is this some form of EXTRA tax that goes beyond that of mail order? Sounds like very unfair business practises.
2. If your revenue for the state is low, try incresing the numbers you multiply with the tax percentages. That is often much more effective than raising the tax percentage (and making people do what they can do avoid it), which more than likely will have the opposite effect. In this case internet sales will go down, and the economy is far from stimulated.
3. Politicians must be idiots. How come we demand that a person who operates on us is supposed to havea this extensive surgeon education, but a politican who controls our economy (and hence much of our lives) don't have to know shit about the subject?
4. I don't live in the states, but it is the exact same way here, and the minute the law is passed the mindless drones here will want the tax. So, this is just a glimpse into the future for us here.
I'd guess many people are interested in purchasing online because even with shipping it can end up being cheaper than going to the store. If you charge tax AND shipping, why wait when you can get it cheaper and on the same day (given that you have transportation to whatever store would provide the desired product).
On top of that, you get to check it out and play with it when you go to a retail store. So, what would be the point in going (aside from avoiding the incompetent computer sales staff).
Am I really on /.?
This story seems to have actually sparked intelligent discussion..
I'd be happy to send them 10% of all the results of my transactions with PRON sites....
looks like I will have to resort to finding the part# online, then calling in my order. Ohh wait, I already do that.
The really stupid thing about this mess is that state governments, rather than being cautious, saw this as an opportunity to implement all kinds of new spending liabilities. Should we even be surprised that they're all sitting around scratching their heads trying to figure out why they can't pay the bills? Did they really think that this massive increase in tax revenue would continue? Come on.....
The Internet tax is a no brainer. It should have been there from the start, but the loss was small (as with mail order catalogs). Now that eCommmerce is a bigger part of the economy, the laws need to adapt to the new circumstance. It's no surprise that /. readers are against this, as they seem to support any opportunity to get a free lunch.
-a
You know, the really sick part of taxation is that it's essentially the government charing people money for the priviledge of using money. Think about it: you get a paycheck. Take out income tax. Want to save it? Fine, your interest is taxable. Okay, let's spend it. Well, there's sales tax. Whoever ends up with your money has to pay tax on it too, because to them, it's income. Between one consumer and the next, after paying sales tax, corporate income tax, and personal income tax, it's probably possible that one dollar spent by one person becomes fifty cents for someone else.
Of course, one very impractical way to eliminate sales tax would be a return to bartering for your purchases.
In the end, though, the consumer really won't care about a tax for sales on the internet. If the online cost including tax and shipping is cheaper than the cost from a brick and mortar store, you'll buy it online. Which, of course, is why the issue is an issue. If not, well, you might as well take a trip to the tax-free state nearest you to make your purchase and deprive your state of residence from the tax money anyway. For me, that's New Hampshire.
(And once states figure out they're losing sales tax income to neighboring states, I'm sure they'll come up with an interesting plan to take care of that. State border patrols, maybe?)
Uh, when have you EVER seen California State TAX go down? What day exactly was this? How much did it go down? Sorry, but taxes only go in one direction in California, increasing tax is the only thing that ever happens. Now they want to bring that crap in, just like TCPM/PD for your BIOS. It's incrementalism, it's shitty leadership, it's greed, and it sucks. "Sales taxes do go up and down with consumption (obviously) but not as severely as income taxes."
Love Music? Got a Band? Are you a Label? http://garageradio.com
I don't see how the structure of an 'internet tax' would work.
Now the basic premice seems to be that you charge people a sales tax even if they don't reside in the domain (state country whatever) that the company operates from.
so all of the states do this to bolster revinues, and lots of internet companies (the ones that can affort to) are suddenly registered companies in the cayman islands. Just operating a depot from whatever state they used to pay taxes to. so the state looses out.
A simmalar issue has occoured in the UK. All UK bussiness have to charge VAT (which is the same as GST basicaly a percentage charged on top of almost everything you buy.) Now all UK ISPs have to charge this for their services. But AOL is a US registerd company so it can avoid paying it and undercut all the local companies. Even though it sells its services from the UK to UK residents it is exempt from the tax. There are articles on the register here, here, here, here, and here
Then why not have a Federal Sales Tax?
I don't think many of us really want states go bankrupt and see the fall of even the most basic utilities.
If we don't get Internet tax, then we get some other type of tax.
Whatever the implementation, it comes out of our pockets.
We should be happy about the proposal though.
Many people in other western countries pay a sales tax of up to 25% on everything bought on the Internet, just like everything else bought off the Internet.
The whole idea of giving a tax break to Internet retailers was very peculiar to begin with.
Maybe it served a purpose some time ago, but it's time to move on now.
In the EC there is no sales tax, but there is VAT (value added tax). This does not apply to shop sales only, but to any place where value is added to articles (that is government speak for: you sell things for more than you bought them for).
So, we pay VAT on Internet sales as well. There is no need for an Internet tax. The only reason buying via Internet is sometimes cheaper, is that Internet shops may run with less overhead.
You are comparing a government monopoly to a private sector monopoly. Part of the purpose of privatization is to get rid of monopolies (government-enforced/supported, at least). Your comparison is not amongst what it would seem to be.
Now, whether a private-sector monopoly is worse than a government monopoly is debatable. On the one hand, a private sector monopoly is not beholden to the public (usually a private sector monopoly is burdened only by their stockholders/president, and so is usually a direct reflection of that entity). Also, the private sector monopoly can shelter itself behind pet legislators, and further evade responsibility.
On the other hand, a government monopoly can create law to work for itself, can dip into the government money pool (and thus you never know how much the services really cost), has a very nasty tendancy of being unsueable (the DEA and FBI are famous for this), and people are more likely to just put up with the government monopoly (whereas they go screaming to the AG or their congressman if things get bad enough with a company).
So it's a mixed bag.
Now to address several of your points.
First off, the US Postal Service is able to compete with FedEx and UPS for several reasons: prebuilt infrastructure (though that's not as big a point as it used to be), monopoly over post boxes, different type of service (usually slower, less urgent), junk mail monopoly, and they get a big fat check from the federal government every year. Yes, they do. It's coyly put in "off-budget spending". I don't have numbers (my book that mentions it is with another person right now), but it's in the 100's of millions. At least, that was true as of 1993. It's probably risen since then. Oh yeah, and the postal service is not responsible if your mail is lost. Part of the cost of FedEx and UPS is their sue-ability.
Also, I'd like to add: send $1,000 in cash in an envelope marked "cash, do not open" via FedEx, UPS, and the postal service.
Continuing.
How are you counting profits in your 30-60% number? Difference between selling price and buying price? That's not all that accurate, as it doesn't count in capital costs, investment costs, employee paychecks, return merchandise, insurance, so on and so forth.
If that's not how you're counting it, then you're probably mistaken. I say "probably," because I do not know the financial situation of every private business in America. But I do know a few things: most businesses in America are small. I'm counting here by quantity of businesses, not dollars earned, since I don't know that number (though I'm willing to guess that that number would be similar). Gas stations, book stores, grocery stores, so on and so forth. These places as individual businesses do not make a high percentage profit. Their parent corporations may, but probably not. Most gas stations, for example, survive by selling a lot of gas at little profit. They hope that they don't buy too much gas that week, as their competitors may lower their prices, and force them to lower their own prices to near what they paid for the gas. Happens all the time.
As far as "unnecessary government programs" go...well, it all depends on who's doing the deciding of what's necessary, just as you say. Libertarians are not cold-hearted people who don't want to spend a dime on other people; they merely see government as not being the vehicle they choose for their money, and they honestly see other ways to get things done. A Green on the other hand, would probably see most programs as necessary, as the government is (in their opinion) more accountable and more under the control of socially concerned people than business is.
I won't go into naming what programs I think are unnecessary, because it's pointless. There are numerous debates about that by people far more informed than I in such matters, and I'd rather listen and think about what they say than flap my lips about something I'm half informed on.
As far as Edison Schools goes...corpwatch was extremely one-sided in that review. They have also completely neglected to discuss the political problems that Edison Schools has faced. That doesn't excuse their actions, but it certainly does put them in a different light. I'd like to see a rebuttal paper before I make up my mind how I feel about Edison Schools.
If you want a good example of private schools that are run pretty well, and have been for many, many years, take a look at the parochial schools. Especially those run by the Jesuits.
Subject says it all. ;)
Operation Imminent Taxation.
Hehe. Yanks.
Europeans have been paying tax on internet purchases since the beginning. It hasn't hurt the growth in eBusiness (both b2b and b2c).
If you live in the UK, you pay 17.5% on just about everything anyway, so the internet scores on cost cutting, not tax-avoidance.
Pimping my Karma Whore since 1847.
Impact is Imminent.
Can't you hear the thud of our economy further hitting the ground?
Love Music? Got a Band? Are you a Label? http://garageradio.com
A lot of people are arguing how Internet sales taxes are fair, since taxes are already levied on purchases in 46 states. But you need to remember that Internet sales are not entirely taxless.
1) The company that sells the goods has to pay taxes on their annual profits.
2) The person buying the goods had to pay tax on their income.
Those taxes more than cover the buying chain. Why should everyone be doubled taxed for things? They were already taxed on their income, so why tax them AGAIN on purchases?
I can two viable solutions. 1) Raise income tax and ditch sales tax. 2) Ditch income tax and have a federal flat rate sales tax.
I'd prefer the 2nd option myself.
mogorific carpentry experiments
In a real world you pay the local tax.
I already pay my local tax when buying from amazon... So... where is the news???
The purpose of state sales tax is to collect tax revenue for the state. The state (or locality) is under no obligation to keep the roads paved or fix the pot holes. The locality is under no obligation to protect your store from being ripped off (that is your responsibility (i.e. buy an alarm, gun, etc.)). Should your store catch fire, the fire department is under no obligation to see that it does not burn to the ground. The state is under no obligation to train your perspective employees (i.e. min wage 20 year olds).
Apparently you missed out or failed Government 101 in school. We pay the State to provide services, else why pay at all? Health, education and welfare(ie; Police and fire) Military enters the eqution also. Figure it out, or leave the country and go some where your theory is correct.
"reach the profitability of Amazon" ????? Amazon
has YET to turn a profit. Bezos gets paid and a few of the staff, but they have been in the red forever. Read the financial reports! Douchebag!
*I* am the consumer.
*I* DEMAND instant delivery.
If you don't give me INSTANT DELIVERY right this moment I will not buy any more of your products.
FOREVER.
You understand, you little weasel?
Now kiss my anus and beg me to buy some more of your stupid products.
"This makes a lot of sense. Sure, I'm a libertarian who believes in a very limited government, but I also believe that taxes should be used to pay for infrastructure and civil defense. So, with the Internet becoming an increasingly important part of our national infrastructure, it only makes sense for the states to be able to tax us for the upkeep and maintainence of this valuable service."
Then the Federal government should administer(waste) the funds, NOT the State. The Fed should DOLE out funds based upon census figures and per capita. That way, if a State had a small population, they would get less money and Learn to be frugal. California needs to be depopulated anyway. Freaking drybacks!
I don't know, but when I order something from another country (say X), I pay the tax according to the laws of X and the money goes to the goverment of X. That is how it had always been. In some cases you might have to pay an import tax.
(This is not true for the EU zone, but in switzerland I once ordered some books and software from amazon and I had to pay an import tax for the software.)
But of course, perhaps an extra internet tax is meant??? Since the US laws are a bit convoluted with all those 'nexus' shit, I guess the simplest model is to have the location of the business determine the tax.
Consider for example that you send someone in Cairo, Egypt to buy a carpet for you. The man will pay the tax according to Egyptian taxation laws, which will go to the Egyptian goverment. Then, upon entering the country the goods will be inspected and perhaps an extra levy shall be imposed for importation. As this article is about the US states, which cannot tax on imports from other states, the answer is extremely simple. Just pay the tax of the state that the business is based in, to the state the business is based in.
But this is just common sense, and common sense does not apply to panicking politicians, which are at best boingering idiots when sober, which only happens when they are hungover.
"Boingering"(TM) is a new word! Add it to your dictionary for only $13.00 (+VAT)
I miss my rubber keyboard.(Homepage)
How are Internet stores different from mail order? Or the Home Shopping Network? Or ordering anything by phone? If sales tax is charged for Internet sales, it should also be charged for these things.
"Do I dare disturb the universe?"
Howcome they want me to be taxed if I buy something of the net, but If I buy something in a catalog they don't care?
No state sales tax, and therefore NONE on Internet sales.
No state income tax, except for 5% on Interest and Dividends, and that rate hasn't changed in years.
It's unconstitutional not to have a balanced budget.
Yeah, we have an 8% Meals & Rentals Tax on restaurant meals, motel rooms and car rentals to nick the tourists, but it helped pay for the improvements to the highways around the Speedway in Loudon, and a greatly improved airport.
When places like Florida whine that they need to increase the sales tax (it's jumped by 50% in the last 20 years from 4% to 6%) in order "to provide more services", ya gotta wonder how long the taxpayers are going to subsidize runaway spending.
Maybe voters in the states that will be paying the Internet taxes will require that the revenue collected will be used solely to pay off the accumulated long-term debt and prohibit taking out new debt until it's all paid off. In that manner, the actual revenue requirements will drop (since there won't have to be any more interest payments), and the Internet tax can then be abolished. Assuming, of course, that the voters and the politicians they elect can learn to live within their means, finally...
That sounds more like property tax than sales tax, could you go into more detail than no detail at all?
-- 'The' Lord and Master Bitman On High, Master Of All
Thats what really drives prices high there because sales taxes are automatically added to prices. Most of the these sales taxes are the national sales taxes called the VAT (value added tax). American tourists can apply for a refund for big items they take home, but have to pay the normal stuff.
To build a nation of people making $50k per year, serving thier distant rich overseas masters. Thanks Zorro!
I'm not sure how you think of a sales tax as regressive, then take money away from anyone who does well through income tax. Doesn't that sound a little regressive as well? How about a flat tax without loopholes? You had a pretty good start when you said "treat all income is the same". Then when you make more, you pay more... but it doesn't matter how much you make and you still have an incentve to do better income-wise. Under your plan I'd be better off on the street with a bottle than making $100k a year (taxed at 90% to return the "People's Money"), at least then I'd have a bottle.
Right now I "frivolously" spend quite a bit of money to help various charities (in addition to my time of course). If my tax rate goes up much, there goes the charity money as I still have other fixed payments (like housing I already have) to pay. The moment you raise taxes on the middle class and above like that you are AT LEAST going to have a very nasty transition period where a whole lot of money dries up and does nothing to help anyone.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Over here in Europe, especially in Scandinavia we pay VAT on all purchases - no matter how you made them! So - this is nothing new here...
Jorny
1) 30-40 states agree to this.
2) the rest see an opportunity and don't do it.
3) companies flock to these other states to be more competetive because they don't make out-state purchasers pay sales tax.
4) The taxing states get the feds involved to make all states collect sales tax.
5) We wind up with a federal sales tax and the states end up losing tax income.
This is no better than when Michigan started the trend of giving tax breaks to companies that relocate here. Then lots of states jumped on the bandwagon, and now buisnesses threaten to leave if they don't get a tax break. Now all (smart) companies get a tax break, the state is no longer "competetive" with other states, and of course if companies aren't paying the taxes who is?
These guys never think through the long term effects of these things.
Think about it, you already pay taxes when you walk into your local store, right? So all the Feds need to do is say "Hey, you have to collect, report, and pay the taxes on online purchases as well." Make it clear that the location of where the electronic purchase server is located is the jurisdiction that get's the taxes.
Like I said, this isn't a big deal if you think abou tit normally. But the Feds are nowhere near normal (or competent) so they'll muck it up somehow.
Um, I don't mean to rain on you peoples parade, but I do feel there is more pressing news right now -- LIKE THE DEATH OF AMERICAN ICON STEPHEN KING!
He was found dead IN SOVIET RUSSIA this morning. More details forthcoming, but aparently close friend and fan Natalie Portman was first to report the sad news. King's agent Deborah Schnieder said in a statement:
"Literary giant Stephen King was, and is, a shining light that illuminates the world with a relentless spirit of truth and love. This man was not an insensitive clod, but rather was a man that furthered the written art form in profound ways and has made a huge impacton the fiction genre at large. But do not be saddened now. Rejoice in that King gave us all so much of so many kinds of so many things - different ways to look at ourselves, hot grits poured down our pants and the world around us -
Use the life of Stephen King as inspiration. We can all learn something from the enormous span of achievements of Stephen King. No computer nor all your base are belong to us has enough memory to hold all the names of every person whose life King has touched in a positive way."
God bless his family and may he rest in peace.
Look at it like this:
When the RIAA alleges that users are illegally trading MP3 recordings over P2P networks but wants to sue the networks about it rather than the users it claims are the ones actually breaking the law, do we say "Yeah, the RIAA is right that it would be just too much work for them to legally pursue the individuals it claims are breaking the law so it's OK to go after the networks"? Of course not!
So if the States are claiming that lots of their residents are illegally failing to personally remit sales taxes on out-of-state purchase (whether mail order or internet) why should we suddenly agree that OK for the States to impose extra business costs on out-of-state retailers just because they say it would be too much work for them to go after the individual taxpayers they claim are breaking the law?
just tax the porn and all shall be good.
I worked for a company that had physical stores in 7 or 8 states. We would get audited by at least one state per year. The audits were harsh. They went something like this:
"You have shipped 80% taxable goods to a sample of 5 stores, 20% nontaxable, yet your sales breakdown is 78% taxable, 22% nontaxable".
"We think that this means that your clerks ring up taxable goods as nontaxable for the extra 2% of the time".
"Based on that error, you owe us the extra 2% extrapolated across all sales in your stores in this state over the past 6 years (the last time we audited you)."
"Please send us a check for $200,000 within 30 days".
It was brutal.
Now take that and extrapolate it across 50 states, and thousands of municipalities. Sure, they'd only hit the larger taxpayers, but eventually they'd hit the smaller and smaller merchants.
After all, we're talking about states and cities that go after baseball players' salaries, taxing them on 1/50th of their salary if they play in their state/city.
I thought the surviving .COMs were doing *better* than their bricks-based brethren. Besides, I already have to not only *pay* "use tax" on out-of-state purchases along with my Indiana income tax, I have to keep records and figure the tax myself. It's more work than all the rest of the form combined, and it's the part that bugs me the most. I wish the states would get off their collective rumps and agree on sales tax pass-through standards, since I gotta pay the tax anyway and I'd rather see it computed by thousands of merchants instead of millions of customers.
(Some of my emotion on this issue is my conviction that I'm one of perhaps as many as nine Hoosiers who don't just ignore the use tax.)
There is a large lower rural land owning group of people. ie rednecks.
That's coming too.. just a matter of time before they tax the air we breathe.
Someday the public will rise up and say no.. but that's a long way off it seems..
The revolution was partially due to over taxation.. now we do it to ourselves even
worse. how ironic...
---- Booth was a patriot ----
The solution (if this comes to pass) is to form a barter club. Here's how it would work:
I do a job for you - you credit my 'barter account' with X number of points.
I want to get a new tire for my car, so I surf to the internet 'tire' guy's website, and order a tire. The number of points needed to get the tire are deducted from my barter account.
Its as simple as that. No real money enters the system.
The drawback is that you would need to have a skill or provide a product or service that people would want. Every member of the barter club would have to have something to barter.
There would be no legal precidence for taxing these 'transactions' since no money is passing between hands.
Lodragan Draoidh
The more you explain it, the more I don't understand it. - Mark Twain
The real question is: can the fragile internet economy really help local tax economies now?
"Fragile internet economy" my ass.... Hell, "Internet Economy" too while you're at it. The Internet is not its own economy, it is a part of all other economies, and sure as hell isn't fragile. It may not be in trillions of dollars, but it's not going to collapse or anything. Heck, it's less fragile IMO because it's not trillion-dollar. Of course, IANAEconomist.
At least in Wisconsin I'm required to declare how much I ordered from other places. If the retailer didn't take sales tax out, I'm required to declare the value and pay taxes on it. Sure, most people don't bother (it's difficult for the state to determine that someone lied), but in theory you already pay it.
If the "Internet Tax" simply strives to enforce existing sales taxes, that seems fair to me. If it represents a new tax above normal sales tax, that's not reasonable.
Search 2010 Gen Con events
You know, government in this country already takes in almost a third of the people's wealth.
I just don't understand why there are people who still want to pay more. I say, 1/3 of income is already enough.
Those who feel compelled to give more can always give to their favorite charity. Why the need to impose on everybody else?
At first, I balked at the taxation. Then I realized why I buy online anyway; because without exception, I have NEVER found a local retailer that was worth a damn in over 40 years based on price, selection, or in stock inventory. A tax will not fix local retailers real problems, and they will fail anyway.
Almost without exception retailers act as if they have a *right* to charge 30%-50% above cost to pay their overhead; kinda like "I opened my shop, so pay me for the priviledge of coming in the door and actually needing something; see, I kept it warm and covered with dust for you!". Now I know that some shops must be good as people still shop there, or maybe people are really dumb; you sort it out.
I'll pay the tax grudgingly, but that won't save the ridiculous local retailer from failing anyway.
Does everyone think that corporations don't pay taxes? The top corporate tax bracket is 10% higher than the top civilian tax bracket. A mammoth 51%. Granted that is not the realized tax rate due to deductions, etc... However, I would wager that their percentage is still rather large. What Bill Gates pays in taxes is NOTHING compared to the taxes Microsoft itself pays. It can be argued that the civilian population doesn't carry the tax burden it would like to believe. Simply put, people easily forget that civilian taxes don't account for 100% of taxes paid in this country. States should spend more time attracting businesses rather than trying to take a slice of pie that isn't theirs. A highly profitable business yields more collected tax, and successful businesses employ more people, which yields more taxpayers. Higher corporate state taxes reduce the likelihood that businesses will come to your state. So, lower taxes, both civilian and corporate, drive revenue. Businesses have a cheaper place to do business which increases their profitability, and the more profitable they are, the more tax they pay. (10% of a dime, vs. 10% of a dollar). Civilians increase their spending because of more money to burn which drives corporate profitability as well.
Sales/use taxes aren't just for states anymore. Cities, counties, school districts, water districts, mass-transit districts, and every other penny-ante governmental unit is in the game, too. We're not talking about just fifty taxing entities, but THOUSANDS, each charging a half-percent here or a quarter-percent there, all with overlapping and inconsistent geographical boundaries and specialized conditions and exemptions.
How exactly are all these nibbling Lilliputians to be satisfied by any internet sales tax that doesn't cut them in for their "fair share"? If their nibbles are to be accomodated in a proposed taxation plan, how are small business owners supposed to keep up with this ever-shifting maze?
The only solutions I can see are (1) cut the little governmental units out of the picture, doubtless resulting in howls of dismay, or (2) use a massive and perpetually-updated database to keep track of the taxation requirements. The later option could be quite expensive and has the potential to be very unfreindly to small businesses if it becomes dominated by large corporate entities.
Some of us have to pay income tax to the city where we work.
Some states don't have any sales tax
> 2. vote in people who will repeal the tax laws
IIRC, one of the reasons mail orders are not taxed is that the people who would be taxed do not live in the state and thus have no representation. Same with internet sales.
I keep reading about internet taxation on slashdot.
What's all the fuss about? Why would the internet's involvement affect taxes at all, in any direction?
Are purchases made over the internet in the US not subject to taxes they would otherwise be subject to?
/ Peter Schuller
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peter.schuller@infidyne.com
http://www.scode.org
Ok the question asked shouldn't be "Can the fragile internet economy really help local tax economies now?" It SHOULD be is making it harder for people to buy things on-line the best thing for the US economy? I admit the states need money, but look at x-mas sale, a great number of which were ONLINE. Does the government really want to do ANYTHING that could hurt sales/commerce right now? That's right, let's shoot the economic recovery in the foot!
The trick is to pay the right tax in those states with balkanized tax districts, such as here in Colorado. They base the tax on your zip code--but zip codes are not drawn according to political boundaries. Multiple cities (with different tax rates), even addresses in different counties, will share the same post office (and zip code). They will also assume that everybody lives within city limits. That over-taxes those who live in unincorporated areas.
So before they make the taxes ubiquitous, I want them to develop a way to calculate them properly!
After reading this thread, I just need to say that I've never seen a bigger collection of idiots in my life. Memo to 95% of the people that replied to this thread: You are a bunch of uneducated morons lacking basic knowledge of government and economics. Likely, you're the product of our propaganda machine, A.K.A Public Education System.
To all of you, I point a finger, and say "it's your fault". Its your fault that we pay more than half of our income in taxes... its your fault that our government is hungry to steal more of our money because your misunderstanding of taxes allows it happen. You keep saying that its "ok", and elect people that want to steal your own money. Fine.
The state of Ohio already taxes internet purchases out of state. It is grouped in with the Ohio Use Tax. A very old law on the books that taxes out of state mail order purchases. Ohio grouped internet purchases in with this.
Actual text from the 2001 Ohio EZ.
Please use line 11 of the IT-1040EZ income tax return to report the amount of unpaid sales tax (if any) that you may owe from out-of-state purchase(s) that you made in 2001 (e.g., mail order or internet purchases)...
According to the reporting the last two years that this has shown up on the forms this is regardless of whether the company has a presence in the state or not.
Another article I read mentioned that some representative are debating on making the internet taxfree indefinitely and closing the loopholes in a dozen or so states that allows taxation of internet purchases.
Some states exempt some items such as food and clothing even that isn't done very well in Michigan prepared food is taxed but groceries are exempt. It makes sense to me that a bugrer at the resturant is taxed but the ground beef at the grocery isn't; but I can't figure out why a bag of potato chips at the grocery store isn't, but the same bag of chips at the gas station is.
For this to work they are going to have to co-ordinate definitions to classify goods so that taxability can be defined, and as the above example shows it could very well be a double edged sword for the states involved.
Sales tax is a bit more honest because its added to the price for the customer to see. I wonder which state gets the tax when sombody orders with a billing info a Michigan address for his credit card, and ships to his second home in Florida? Or Even more common I buy a gift online, from Michigan and have it shipped to my son in Hawaii.
This will get even more interesting when Cities start complaining, some cities charge sales tax too.
Apocalypse Cancelled, Sorry, No Ticket Refunds
Here are a couple of widely ranging points that have not yet been discussed.
First, many people in this thread have said things like "Why increase taxes, just reduce spending!" Unfortunately it is not that simple. (Disclaimer on the following statement: I am a libertarian, and hate taxes, but I am also a pragmatist). Believe it or not, most local governments are __required by law__ to spend. Here's how it works: when you vote for a new park, the city must provide it. When you vote for new bonds, the city must pay the interest. There is no way out. The only solution is to vote to change the spending requirements. This is not easy since some of the budget goes to poor, battered or otherwise disadvantaged people. Or to libraries for people who can't afford to buy books (me included). Or to public schools for people who can't afford private school. Who wants to take services away from these poor folks? The rest of the budget goes to local infrastructure. How will they decide which roads to close or bridges to stop maintaining?
Second point to consider: What should the tax rate be? Simple, you say, just charge the state tax rate of the purchaser! Bzzzzzzzzt. Wrong answer. There is no such thing as a simple tax rate in many states. For example, I live in Washington State. The sales tax rate is based on where I buy the item, or where I live, and can vary even within a city or county! Check it out at here (scroll down to the rate table). Here's how it goes. The State of Washington collects all sales tax, and then distributes the correct portions to the cities/counties. If I buy something from my neighbor's business, I pay 7.6%. If I travel just one mile away, I have to pay 8.0%. If I buy something 20 miles away in Seattle I pay 8.8%. If I buy something 10 miles away in Redmond or Kirkland, I also pay 8.8%, even though they get a substantial revenue from RADAR speed traps. If I have a Seattle contractor put an addition on my house I pay 7.6%, not 8.8%. If I buy something online from a company that has no presence in Washington state, I don't pay any sales tax, but I "must" pay 7.6% use tax. If I buy something online from Amazon, I pay 8.8%, unless I have them install it at my house, in which case I pay 7.6%. The situation has been complicated even further by the existence of taxation jurisdictions. For example, if I shop within the "Regional Transit Authority" (RTA) area I pay an extra 0.4%. The RTA apparently was drawn by a kindergartner on a map, and covers portions of King, Snohomish, and Pierce counties. Of course, all of this changes quarterly. How do you ever expect Bob's Hot Sauce in Wisconson to know the amount to charge me for sales tax? How can he calculate the correct taxation jurisdictions? Businesses in my own state can't even do it! There is supposedly a database available with every address in Washington that Bob can use to calculate the tax on hot sauce, but think of the software Bob will now be required to get. He doesn't even have a computer (he counts on the local high school nerd to set up his online presence).
Final point. When I buy items in Canada I pay a national GST tax of 7%. I also pay either for shipping or Provincial Sales Tax (7.5% in BC, if I buy in person). I can get the GST tax refunded, but not the PST. Who should get the PST money? Just last weekend in Canada I bought a US made item for really cheap (due to exchange rate) paid GST and PST, sent in my GST refund form, am I supposed to pay Use Tax? Who knows? I didn't have to pay duty since it was made in the US. The issue is too complex to make generalizations about, and involves two regional authorities, two federal authorities and international trade law. The system is too difficult for us average joe citizen's to figure out, so we will lose in the long run.
A.C.
I can't believe people still believe that there is some sort of "law" that says that Internet purchases are free of sales tax.
Sales tax is still collected by web sites for purchases shipped to places where they have a physical business location. For instance, if you live in Washington State or North Dakota, your purchases on Amazon subject to sales tax. This is true for every other website that has physical offices in states which levy a sales tax.
Technically, if your state has a sales tax, you are obligated to pay the sales tax on all purchases regardless of where they originate. If you purchase something from a retailer that has a business presence in your state, they remit the tax for you. If the seller doesn't have a business presence in your state, then YOU are obligated to send it in yourself. Of course, 99.9% of people don't do this; technically we all are in violation of the law.
The reason for this is that states have no juridiction to compel out-of-state retailers to collect the tax for them. That doesn't mean that the tax doesn't have to be paid - just that they can't make the company their "tax collector".
In my home state, there is actually a form that comes with your state tax booklet that you are supposed to fill you to pay sale tax on out-of-state purchases. Also, if you purchase a car out-of-state and try to register it in my state, you need to provide proof that you paid the appropriate sale tax, otherwise they won't let you register your vehicle (they do give you a credit based upon the sales tax paid to another state, so you don't end up paying sales tax twice).
Personally, I don't see any problem with the current system. As things are, Internet sales are treated like any other catalog and mail-order sales: if the business is in your state, they collect the tax, and if not, you have to pay it yourself (wink, wink)...
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www.moneybythenumbers.com
The government may not be our "buddy," but it is far from being an enemy. It must be funded; the very government some claim is so greedy is the same that allows us our freedom, and even the ability to have an e-economy in the first place. I agree that waste and fraud need to be cut before new taxes are levied (effeciency is NEVER a bad thing) but folks oughta lay-off the anti-government angle. We're Americans because there is an American government, and visa versa. There's always a price tag; it's just a fact of life.
I think you have a misunderstanding of supply side economics. It's not a matter of wealth creation, it's a matter of motivation. It derives from a few simple calculations regarding revenue. You'r revenue = (tax rate) * (tax base), but as your tax rate rises, peoples motivation for creating wealth decreases. This is trivially true. Think about it. If I tell you that I am going to tax you 100% (assuming we still live in a free society) are you going to bother to go to work tomorrow? A similar arguement might also apply for a 99% tax rate. Now granted, everyone is going to have to eat, and is thus going to have to do a little bit of work, but (especially) in a progressive tax system, as you earn more, you get to keep less. That means we are giving you an incentive to not create as much wealth. As I said before, it's trivially true that extremely high taxes will reduce wealth creation (by reducing motivation), so the only question is, "how much is too much". I believe this is where the term Voodoo economics is most applicable, primarily because the nature of this relationship is so complex that you essentially have to try things based on your magical voodoo sense of what will help, and see if it works, and even if it does, it could be for completely unrelated reasons. One other thing to note is that as you lower taxes, you reduce people's motivation to spend huge sums of money to hire tax lawyers to help them avoid paying taxes. I was reading an article last year about the current economic prosperity in Ireland due to tax cuts from about 60% to about 10%. The most interesting thing in the article, however, was a contention that worldwide, large corporations and individuals pay roughly 10-15% in actual taxes regardless of the tax rate. They do this by either hireing lawyers to find loopholes, or by moving out of the countries where they can't find such loopholes. In essence, I guess I have 3 points.
1) Supply Side economics doesn't say that lowering the tax rate will always generate more revenue, it simply says that raising taxes won't always generate more revenue, and that there is some optimim tax rate which may even change from time to time depending on a huge number of factors.
2) Like you say there are only a few ways to create wealth, but taxes are about distributing wealth , not creating wealth. They are also used to motivate economies. Finding better ways of distributing wealth and motivating wealth creation can leave you with lower taxes, and higher tax revenue. We can argue about what the best way to do that is, but saying that either raising or lowering taxes will always result in more revenue is naive.
3) Worldwide, wealthy individuals seem to pay around 10-15% no matter what your tax code looks like, and having a complex tax code only serves the wealthy, while hiding the truely regressive nature of many tax structures. Often times, tax cuts which appear to favor the rich, simply reduce motivation for the rich to find loopholes.
I've got much more I could say on the subject, but if you've read this far, I'm sure you will respond, or dismiss me as a crackpot, and I can make more points in a later post.
Your argument that someone is motivated to clear doesn't really hold water, except possibly for the lowest wage earners. It leaves out the idea that people have a choice with what to do with thier time and money. Take someone who is working 40 hours per week just to put a roof over thier head and food on the table. If you raise taxes from 15 to 30%, they may be motivated to work 50 hours per week just to hold on to what they already have. If you shoot it up to 60%, rather than working 80 hours per week, they might just say screw it, and get a smaller house, or even say I might as well live on welfare. Lets say I work 40 hours per week and make 50,000 per year. If my goal is to make 800,000 per year, all I have to do is work 640 hours/week. I'm not very likely to attempt this:) When you talk about the rich, however, they have many more choices. They generally make thier money not by laboring for it, but instead by risking what they already have. Don't get me wrong, many of them had to labor for it initially. I'm currently laboring my ass off so I can have enough that I can make money by risking it rather than making money by laboring for it. If I can risk my million dollars for a chance of making a million, and a chance of losing half a million.I might make that bet. If the government is going to take half of my profits, I'd be less likely to make that bet, and instead I might just sit on my money. Or I might move to a country where they take less of my money. At any rate, my job (when I have finally made enough money to be able to invest in this fashion) is to provide resources to people who are trying to create wealth in the fashion which you suggested earlier. The fact that I have built my own wealth by choosing how to distrubute resources inherently qualifies me for this role. If the government makes it less profitable for me to distribute my resources to create wealth, I'll be less likely to distribute my resources. It's as simple as that. Now people who inheret wealth have no particular qualifications as to how to distribute it effectively, and that's why I think the inheretance tax is one of the fairest taxes around, but that is a completely different conversation. The original point I was trying to make is that lowering taxes clearly can stimulate an economy, and supply side economics clearly can work under certain conditions. It's just that no one knows exactly what those conditions are, and I suspect that that those conditions change depending on the current psychology of both consumers and investors, but as I alluded to before, I tend to believe that all economics is "Voodoo" economics. That's not to say that economics is useless. It's just that it's extremely debatable and hard to develop rules for, and as soon as you have some rules that seem to work, the whole system changes.
If you raise taxes from 15 to 30%, they may be motivated to work 50 hours per week just to hold on to what they already have. If you shoot it up to 60%, rather than working 80 hours per week, they might just say screw it, and get a smaller house, or even say I might as well live on welfare
Problem is, this motivation thing you're talking about is "supply-side" economics, or more accurately "trickle-down" economics. It's not "trickle up" economics. The reality is that those who pay the most taxes are not motivated to make less money by higher taxes, they are motivated to hide more money by higher taxes.
If the government makes it less profitable for me to distribute my resources to create wealth, I'll be less likely to distribute my resources.
This works when it comes to the government shifting the tax burden from one area to another: say by lowering capital gains taxes and raising property taxes, one would encourage more investment in non-real property. But it doesn't really have as much relevance to how much people are "motivated" to earn, as you put it at first.
I might make that bet. If the government is going to take half of my profits, I'd be less likely to make that bet, and instead I might just sit on my money.
But most investments don't work like that. And let's remember, that the kind of "making money" you're talking about here is merely redistribution, with as far as the government is concerned is irrelevant to the overall size of the economy. The government wants to see the money circulate as much as possible, and in some ways it is better for it not to circulate through the accounts of the big rollers (who are likely to sit on a lot of it: how much money is Bill Gates sitting on right now?) if it can circulate through 8 or 9 other people's accounts instead.
"The real question is: can the fragile internet economy really help local tax economies now?" I don't think so. In fact, I think that the additional resources needed in each state to regulate such taxing would prove too high a cost to justify starting such a new taxing program. But the bigger question may be: What about eBay sales, and the like? How will eBay and Paypal, and then their customers, be affective, if at all, if 'Net taxation becomes reality? Thoughts?