DMA Disputes "Lost Taxes" Numbers

DaveAtFraud writes "The Direct Marketing association (DMA) has released a study (PDF only) showing that the amount of tax revenue supposedly 'lost' by the states due to on-line sales has been significantly overstated. Proponents of online taxes quote several University of Tennessee studies which found states missed out on $13.3 billion in 2001 collections. In contrast to UT's claim, the DMA's study says the figure was closer to $1.9 billion. And while UT finds states could be stiffed by $55 billion in 2011, the DMA claims it's more like $4.5 billion. You get the picture (I wonder where UT gets its funding? It wouldn't be the state of Tennessee by any chance would it?). The DMA study points out flawed growth assumptions and outright falsehoods (e.g., counting certain business-to-business transactions that actually did create tax revenue for the state in its count of missed taxes) in the UT studies that cast a shadow of doubt on the UT studies' validity."

Comments

Re:Bias

[sweetooth]

True, but the number is possibly somewhere in the middle which seems much more reasonable.

They're both wrong.

[rudy_wayne]

The amount of tax revenue lost by the states is exactly zero.

1. You can't lose something you never had.
2. There is no legitimate reason to collect these taxes.

The clamor for these taxes is merely another attempt by greedy politicians to shove their hands deeper into the pockets of consumers. With the economy the way it is, and many states facing multi-billion dollar budget deficits, the states will tell whatever lies are necessry to raise new revenues.

Re:They're both wrong.

[unitron]

". Assuming that consumers would buy the same goods whether online or in stores,..."

Yeah, right. I can go right down the street and get it right away for about the same total expenditure but I'd rather buy it online and wait a week or so for delivery. Uh-hu. Sure.