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10% Tax On Custom Software, $100M Tax Cut For Microsoft
reifman writes "Last week, the Washington State House of Representatives passed a bill which would impose a 10% tax on custom software while all but eliminating a $100 million yearly tax obligation that some say Microsoft is wrongfully avoiding by routing large chunks of business through an office in Nevada. 'I believe we've got an issue of justice and fairness here,' said Rep. Maralyn Chase. 'Most of the custom software purveyors are small businesses. It's a question for me of how we fairly distribute the tax burden.' 'It means that a 5 person team of entrepreneurs building a cool custom software suite, or a group of system integrators, would face a 10% tax on their services while keeping the exact same project in-house would not be taxed,' wrote Rep. Reuven Carlyle. 'It would be a massive blow to the entrepreneurial community in our state.' The bill won't become law until the House and Senate work out how best to raise another $300 million in taxes. A sales tax increase on consumers is also being considered."
This is clearly good for the large number of people who are gainfully employed by Microsoft, and those who invest in Microsoft, the total of which likely vastly outnumbers the individuals who sell simple custom one-off programming services in Washington state. It's a case of the good of the many outweighing the good of the few.
This my friends, is what is known as BAD MATH. Mind, I don't disagree that sales tax is regressive. However, sales tax eats a percentage of your purchase. Poor people go shopping and buy staples and beans and rice and some chicken, and buy 2 weeks of groceries for 60$. Meanwhile, that woman in the lexis with the 2,000$ suit on? She spent 110$ on a bottle of wine, some designer cheese and some pasta imported directly from italy, all for a meal she will eat ONLY tonight.
You can assume that sales tax is more of a burden on the poor, if you also assume the poor and the rich have similar spending habits. But they don't. When I was living up in washington, I spent 100$ a week at the grocery store. Meanwhile, my poor ass friends were spending 100$ a month. Pretty sure I paid more taxes than any two of them combined, given my income, that wasn't unreasonable.
Also, by your definition, aren't all taxes regressive? No matter what percentage you take from me, if you take the same from anyone else, one of us is going to feel it more. Are you suggesting that it would be better if poor people didn't have to pay as much percent in taxes? Say if you make less than 25k a year you pay 1/2 taxes? Does that mean you support making the top 10% pay double? Because it's the same thing.
Hmm, and just wait for the unfunded Medicare mandates and other tax goodies come in when the Obamacare comes into play. Yep, they'll need more revenues then too.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Govt takes in 3 dollars and 1 comes out. The govt does not create money other than printing it. Nor does it earn it. You may want to do some more fuzzy math before you make comments like that. Step away from the liberal BS and take a breather.
Is it any of your damned business? Or do you not value personal freedom to do what you wish with your own hard earned money?
Worst case scenario: America spends all its money overseas and we in turn become poor. Good news: Now we are a cheaper market for manufacturing and the cycle of global economic equilibrium reasserts itself.
Life is not for the lazy.