Slashdot Mirror


Senator Warns of Email Tax This Fall

cnet-declan writes "State and local governments in Washington this week began an all-out lobbying push for the power to tax the Internet, according to our article at News.com. A new Senate bill would usher in Internet sales taxes, and the Federation of Tax Administrators (representing state tax collectors) advised senators at a hearing on Wednesday not to renew a temporary moratorium limiting broadband taxes that expires in November. One irked Republican senator warned that unless the moratorium is renewed, we could start seeing email taxes by the end of the year. Former House Majority Leader Dick Armey blames it on the Democrats taking over, as do Yahoo and eBay lobbyists. Is this a non-hoax version of bill 602P?"

29 of 552 comments (clear)

  1. Fine: Define email by panxerox · · Score: 4, Interesting

    They still don't get it, the Internet is not this easily defined thing that you can wrap thier minds around, its not about formats or drm or even email its about information. Anything thats describable as 1's and 0's can be transmitted over the internet, its like saying everytime you call a cab over a landline phone you have to pay a tax, uh no. How many ways can you now transmit info over the net now (?) its nearly infinite.

    --
    "It's so convenient to have a system where everyone is a criminal" - A. Hitler
    1. Re:Fine: Define email by Maximum+Prophet · · Score: 5, Insightful

      From a bricks and mortar perspective, *stopping* the shipment of goods shipped over state lines would be a good thing. I can see many states setting up tax systems that are so complicated and expensive it effectively shuts down direct marketers. (internet and catalog)

      The thing is, the constitution is clear on this. The states don't have a right to charge taxes on stuff shipped across state lines. Why are we even having this discussion?

      --
      All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
    2. Re:Fine: Define email by AKAImBatman · · Score: 5, Insightful

      The thing is, the constitution is clear on this. The states don't have a right to charge taxes on stuff shipped across state lines. Why are we even having this discussion?

      Because Congress (both state and federal) likes to keep the Supreme Court on its toes? It certainly seems like it sometimes. :-/
    3. Re:Fine: Define email by N3WBI3 · · Score: 4, Insightful
      The thing is, the constitution is clear on this. The states don't have a right to charge taxes on stuff shipped across state lines. Why are we even having this discussion?

      Because if there is one thing our government will work hard to to its lighten your wallet.

      --
    4. Re:Fine: Define email by Grishnakh · · Score: 4, Insightful

      You talk like the Constitution is able to limit government's power somehow. I guess you haven't been paying attention, because that hasn't been true for some time now.

    5. Re:Fine: Define email by Kadin2048 · · Score: 5, Interesting

      The thing is, the constitution is clear on this. The states don't have a right to charge taxes on stuff shipped across state lines. Why are we even having this discussion?

      You are correct -- the states can't charge tax on goods shipped across their borders. I.e., they can't have a "California import tariff," as if they were a separate nation from the rest of the country, or something.

      However, the Court has allowed states to charge tax on goods used or consumed in their state. This is how sales tax works: they don't charge the tax when the widgets cross the border from the neighboring state -- that would be illegal due to the Constitution -- but they charge the tax on the sale when it occurs in the state, or on the use of the item if you bought it elsewhere and are using it in the state. (Most people don't realize this, but if you buy something via mail order and use it in a state that charges sales tax, you're legally obligated to pay the same tax rate on it, only as a "use tax" instead of a "sales tax." All states that have sales taxes also have use taxes.)

      That's how they get around the unconstitutionality. If it seems like hair-splitting, I'd probably agree with you, and there's a chance that if states really started getting obnoxious with their tax structures, to the point where it was interfering with commerce between states, then the USSC could step in and basically say that they have de facto violated the Constitution by creating barriers to trade ... but I wouldn't hold your breath.

      --
      "Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
    6. Re:Fine: Define email by Anonymous Coward · · Score: 4, Informative

      No. If the business has a physical presence in your state, then it is taxed at your state's rate.

      If the business doesn't have a physical presence in your state, then it isn't taxed. At least in practical terms, that is.

      In theory, the states typically think they are due tax, and it is supposed to be voluntarily paid by the consumer on the consumer's state tax return. But without a physical business presence in said state, there is no good way to enforce that.

    7. Re:Fine: Define email by russ1337 · · Score: 4, Insightful

      >>> I thought you DID pay a tax when you used a land line phone? For each and every call you make a small portion goes to state and federal tax coffers.

      And I already pay a variety of local and state taxes on my internet monthly bill.

  2. Well then... by Organic+Brain+Damage · · Score: 4, Funny

    we'll just tax the 1's and leave the 0's free?

    If it's an out-bound tax, could it be used to make SPAM economically unrewarding?

  3. Well, why not just by Bananatree3 · · Score: 4, Funny

    put a toll meter on one of the Tubes. Voila!

  4. DAMNIT! by C_Kode · · Score: 4, Funny

    If they start taxing Email I will just start using Gmail!

    Now take that you bastards!

    1. Re:DAMNIT! by Rob+the+Bold · · Score: 4, Funny

      If they start taxing Email I will just start using Gmail!

      One step at a time, dude. First switch to Fmail, then Gmail.

      --
      I am not a crackpot.
  5. Democrats, right, of course by hxnwix · · Score: 5, Insightful

    That makes sense because Mr. Enzi, the bill's sponser, who is listed at the very top of the bill as its sponser, is a Republican.

    Yes. That's right. Republicans want big government in your computer and want big government's hand in your wallet.

    1. Re:Democrats, right, of course by KermodeBear · · Score: 5, Insightful

      Unfortunately, this is turning out to be more and more true as time goes on. The Republican party is really losing touch with traditional conservatism: Small government, low taxes, state rights. That's why I'm leaning more towards the (weirdo-filled but well meaning) Libertarian party these days.

      --
      Love sees no species.
  6. "The Internet" is not a tangible thing by TheWoozle · · Score: 4, Insightful

    nor is it a set group of people, places, etc.

    Just how do they expect to enforce their levy of taxes?

    Trying to tax the internet is somewhat like trying to tax other forms of communication. The best they'll be able to do is tax the businesses that provide a service to connect to the internet (telcos and ISPs).

    That reminds me of something... wasn't the Stamp Act one of those "taxation without representation" things that pissed off the revolutionaries in the 13 colonies? Hmmm...

    --
    Insisting on "correct" English is like saying that there is only one, definitive recipe for chili.
  7. The problem... by RealBothersome · · Score: 4, Insightful

    Is the people need to stop electing idiots.

    1. Re:The problem... by Dunbal · · Score: 5, Insightful

      Is the people need to stop electing idiots.

            No, the problem is only idiots run for election.

      --
      Seven puppies were harmed during the making of this post.
  8. New protocol could kill spam by Lt.Hawkins · · Score: 4, Interesting

    If one protocol is taxed, we can push another protocol to take over. Imagine, if email is taxed, having the entire industry shift to a better system that is not regulated, and having the opportunity to design much-needed controls and authentication in to eliminate spam.

    --
    -- My Sig is a P228.
  9. Sorry... by dreddnott · · Score: 5, Funny

    That would only be one step at a time if you were starting with Ebmail or switching to F#mail, then G#mail.

    At least G#mail is pretty upscale compared to Email.

    --
    I may make you feel, but I can't make you think.
    1. Re:Sorry... by interiot · · Score: 4, Funny

      Upgrading from Email to Gmail resulted in Minor issues that made me sad.

  10. RTFA by SpiritGod21 · · Score: 5, Informative

    I just skimmed the bill linked in the summary... is it just me, or does this 1) not appear to apply to email whatsoever (it's not mentioned anywhere in the bill, though VOIP is) and 2) only applies to business doing $5 million USD or more in business a year.

  11. Familiar by Sciros · · Score: 5, Insightful

    It's similar to what the Dems pulled with the "bringing back the draft" BS they tried to claim Republicans were planning during the 2004 election (Dems were the ones who proposed twin bills for it, but then voted against it cause it was just a campaign tool to get college students to pledge votes for Kerry).

    Now Republicans seem to be doing the same thing. Propose a BS bill, then claim "it's the Democrats' fault!"

    I F-ING HATE POLITICS

    --
    I like basketball!!1!
  12. Re:One doesnt justify the other by LWATCDR · · Score: 4, Interesting

    "Right now ALL retailers and people are required to pay sales tax on out of state items (depending on your state)"
    Ummm... Huh?

    States are forbidden from taxing interstate commerce. In some states if you buy something from out of state you the customer are supposed to pay the tax.

    How can ALL the Retailers be required to pays sales tax on out of state items (depending on your state)?
    1. I don't think you know what the world ALL means.
    2. It isn't true. You must pay sales tax if you have a presence in that state. If you have a store, sales rep, office, or warehouse.

    --
    See my blog http://ilovecookes.blogspot.com/ for light hearted technical information.
  13. Everyone calm down... by isa-kuruption · · Score: 5, Informative

    There are two separate things going on here.

    First, the bill in the story has nothing to do with taxing internet email. It has to do with, specifically, sales taxes on goods purchased over the internet.

    The second part of the story is about the temporary moratorium limiting broadband taxes which limits taxes on items such as email, web surfing, etc.

    Needless to say, these things are completely different. Leave it to crap|net to mix them all up to get your feathers ruffled.

    In the first case, the bill being sponsored by Mr Envi, I kind of understand where he is coming from. States and local governments get a lot of their revenue from sales tax. Since there has been an increasing number of purchases made online, state and local governments and losing out on that sales tax money, which means they need to raise other taxes (e.g. property, fuel) in order to compensate. This hurts everyone, even those that do not own computers, and especially hurts the elderly who live on limited income. This bill also simplifies how states collect taxes for retailers to reduce paperwork, and has an exemption for e-tailers that earn less than $5 million a year doing internet sales.

    On the temporary moratorium limiting broadband taxes, this is something that has been renewed every couple of years for the last several under the Republican-led congress. The idea is that general broadband services are not taxed, such as email and web surfing, at the federal and state levels. It does not appear this will be renewed which means *new* taxes could (and probably will) be added to Internet users.

    Now that it is clear...

    While some may point out that Mr. Enzi is a Republican raising taxes, he's not so much raising taxes as he is 1) simplifying sales taxes; 2) ensuring the "current" level of taxes imposed by states; 3) thus reducing property taxes; 4) helping maintain state governments who are having financial problems due to lack of sales tax revenue.

    On the other hand, the Democrats, if they do not renew the ban on broadband taxes, will be creating new taxes that will impact every internet user. These are not taxes that are being avoided or taxes that are being suppressed.... these are NEW taxes.. and we all know how the Democrats love their taxes!

    1. Re:Everyone calm down... by dcollins · · Score: 4, Insightful

      While some may point out that Mr. Enzi is a Republican raising taxes, he's not so much raising taxes as he is 1) simplifying sales taxes; 2) ensuring the "current" level of taxes imposed by states; 3) thus reducing property taxes; 4) helping maintain state governments who are having financial problems due to lack of sales tax revenue.

      On the other hand, the Democrats, if they do not renew the ban on broadband taxes, will be creating new taxes that will impact every internet user. These are not taxes that are being avoided or taxes that are being suppressed.... these are NEW taxes.. and we all know how the Democrats love their taxes!

      Republicans raise taxes --> that's really lowering taxes.
      Democrats don't raise taxes --> that's really raising taxes.
      ORWELLIZATION COMPLETE.

      gg gop

      --
      We know where leadership by an anti-intellectual "strongman" who scapegoats minorities and likes boisterous rallies goes
  14. Vote for Ron Paul by Lost+Found · · Score: 5, Informative


    Brief Overview of Congressman Pauls Record
      He has never voted to raise taxes.
      He has never voted for an unbalanced budget.
      He has never voted for a federal restriction on gun ownership.
      He has never voted to raise congressional pay.
      He has never taken a government-paid junket.
      He has never voted to increase the power of the executive branch.
    He voted against the Patriot Act.
      He voted against regulating the Internet.
      He voted against the Iraq war.

    http://www.ronpaul2008.com/

  15. Supply Side is better for gov't revenue by yog · · Score: 4, Insightful

    Well there were several things mentioned in the article. While taxing email is technically unfeasible not to mention rather ridiculous, they definitely want to tax commerce that utilizes the Internet to work more efficiently.

    For example, if you buy a book off Amazon.com, Amazon would pay local taxes to the "streamlined sales tax" system they're proposing. Of course, the consumer would bear the expenses of such a tax.

    They (I'm lumping all the tax maggots into one pronoun) also want to impose a monthly internet use tax, i.e. a DSL tax.

    What the Dems don't get is that the supply side approach is much better as was demonstrated during the 90s when many successful companies were founded such as Amazon and EBay. Although local sales taxes are avoided, these companies nonetheless contribute mightily to the tax base through employee income taxes, employee purchase of local homes, cars, food, travel services, and other products, corporate income tax, capital gains and other stock transaction related taxes, etc.

    The internet revolution demonstrated the superiority of supply side economics. The successful companies generate the most revenue streams for the government in an organic manner. Imposing a regressive, universal tax on transactions will probably not destroy the current giants but will certainly discourage new companies from flourishing. Instead, incompetence will be rewarded because local governments will get all kinds of revenue they didn't deserve and will become totally dependent on it.

    Then there are the unknown future uses of the internet that most of us can't even conceive. What about internet-based medical care? A surgeon on another continent operating on a patient via precision remote control, or physicians providing consultative services remotely--all of this will get taxed, and the middleware companies that are trying to market these services will get taxed to death before they can even get off the ground.

    Monthly internet connection tax--what a slippery slope! Next they'll be taxing by the byte. Ultimately the cost of doing business for everyone will go up, including bricks and mortar stores which are also dependent on the internet today to run their businesses. Salaries will necessarily go down, people will have less discretionary income as a result, and the U.S. economy will be further Europeanized.

    It will then become even more economically attractive to outsource manufacturing and service jobs. This is all to China and India's benefit. Thank you Hilary and the Dems for destroying the last bits of American competitiveness, and thank you to the American people for voting these imbeciles in.

    --
    it's = "it is"; its = possessive. E.g., it's flapping its wings.
  16. Let's cut to the chase by DanielMarkham · · Score: 5, Insightful

    Let's cut to the chase:

    • It's not about partisan politcs. It's a power grab by a political system that continues to trade money to special interests for votes. Not all spending is bad. Some is. But that's a conversation for a different day.
    • It's not about email, sales tax, or whatever. It's about having a lot of money floating around on the net, and politicians wanting a piece of the action.
    • It's not about reason. Yes, taxing email makes no sense. Neither does taxing online sales, which will just move elsewhere or underground. This is the same political setup as DRM -- people will wave their hands around and make great moral arguments about people "paying their fair share" and "making big business pull it's weight" ad infinitum. If you choose to buy this schtick, don't come complaining to me
    • These things have historical patterns which are instructive. Take a look at the income tax: passed in the early 1900s to pay for WWI. Supposed to only be around a few years. The Alternative Minimum Tax (AMT), passed recenty, supposed to sock it to the rich guys who have too many tax breaks. In each of these cases and dozens more, the bozo-head making the original pitch disappears but the tax never does. Most times it just grows. "Letting the moratorium expire" or "streamlining the tax sysem" is just a way of getting a foot in the door. They know they can't go after your wallet directly, so they're willing to take a decade or two. Like the story of boiling the frog.
    • This isn't about good people or bad people, or good government or bad government. This is about the natural tendency of the government over the past seventy years to consume more and more resources from the people it is supposed to be protecting. I imagine most of these expenditures are great ideas. The problem is that we can't pay for the crap politicians got elected on twenty years ago, much less the crap they're promising for the upcoming election. Both parties, full of great, smart, ethical people, are stuck in a process that is always looking for more money to pay off special interests. Nobody fixes a problem that isn't immediate and crtical because they get votes for blaming things on the other guys.
    • It's a losing game. We can try to stop them at this line by trying to pass something like a constitutional ammendment preventing any tax on internet-based economic activity, but this is a thousand-year battle, guys. One which we'll probably lose very quickly while you-all go patting yourself on the back for not buying into the FUD and being so much smarter the the political wonks.
    • It'll work just like DRM. In the grand scheme, it will push the economy underground where it will be completely unregulated and offshore where people actually appreciate the business. But pay attention: soon (within ten years) we'll be hearing those same old DRM stories spun for sales taxes. Granny makes rugs in basement and goes to jail for failing to file. Big companies setting up offshore pulling american dollars for the same stuff that used to happen here. More politicians will appear on TV yelling at the other side for getting us into this mess, and promising to fix it (either by law and order or by relaxing the law). Nothing will happen, though, because this will become yet another issue that can be used to stir up support for an election. Fixing the problem would be like throwing cold water on the base, so it ain't gonna happen.
  17. That is a bit misleading. by ichigo+2.0 · · Score: 4, Insightful

    His opinion on those things do not matter. He is a constitutionalist, and is of the correct position that the federal government has no business in legislating anything related to abortion, gays and "all the usual stuff". States are the ones supposed to deal with such matters.