Senator Wants to Tax Internet Shopping

tripleevenfall writes "A Democratic senator is preparing to introduce legislation that aims to end the golden era of tax-free Internet shopping. The proposal — expected to be made public soon after Tax Day — would rewrite the ground rules for Internet and mail order sales by eliminating the ability of Americans to shop at Web sites like Amazon.com and Overstock.com without paying state sales taxes."

Comments

Surprised?

[Totenglocke]

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

Re:Surprised?

[Black Parrot]

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

Nope. We've got tax-and-spend Democrats, and don't-tax-and-spend-more Republicans.

Re:Surprised?

[OeLeWaPpErKe]

Well, you're right of course. But let's analyze that scenario, shall we ?

Not cutting revenue before cutting spending boils down to putting a large pile of money in front of ex-lawyers, and expecting them not to touch it.

So I'm not sure there's much of a choice there.

Re:Surprised?

[DCstewieG]

Ah, the supply side fairy tale.

http://www.factcheck.org/taxes/supply-side_spin.html

Re:Surprised?

[pushing-robot]

http://blog.mises.org/16107/bushs-huge-budget-numbers-blamed-on-obama/

Re:Surprised?

[Anonymous Coward]

The last two years they were trying to stave off another Great Depression, brought on by the crazy policies of a previous administration.

Look at every budget since Carter:

Republicans = Spend Like Mad Without Paying For It.

The Democrats have been the fiscal conservatives for the past 30 years.

Re:Surprised?

[Totenglocke]

Yes, and Obama's first year alone out spent all 8 years of Bush. Facts - they're a beautiful thing.

I despise the Republicans almost as much as the Democrats - but this childish "The Messiah is perfect!" crap that completely defies all facts is really getting old.

Re:Surprised?

[Beelzebud]

Speaking of facts: The fact is that Bush kept the Iraq and Afghanistan wars off of his budget, and didn't fund his Medicaid bill. Obama put those wars on the books, that's why the budget looks so huge now. We're actually counting 2 wars, for once.

Re:Surprised?

[Low Ranked Craig]

I read that twice. I don't think it says what you imply that it says. There are numerous contradictions within the article itself. There is also a lot of correlation but no proved causation. For example, this little nugget: "We’re not quibbling with most of that. A Treasury Department analysis found that the tax cuts prompted the creation of jobs and increased the gross domestic product". So there is no dispute that lower taxes do in fact increase the GDP. The question is do they increase the GDP enough to offset the decrease in tax revenue to see a net increase in tax revenue? In this specific case, yes.

Federal revenue normally increases every year. In fact, revenues have declined in only five years since 1962. The 35 percent growth between 2003 and 2006 is significant – the last major growth in revenue was between 1997 and 2000, when the economy was booming and federal receipts rose 28.2 percent. But the recent three-year period also comes after three years of decreases, a drop Viard attributes to the 2001 tax cuts and the start of a recession that same year.

The economy does not turn quickly. A huge recession started after the dot com bubble popped, then the tax cuts came in 2001. It takes time for that kind of change to see an economic impact. In the short term there will be none, in fact in the short term you will simply see a reduction in revenue. in the mid term, a year or two later you sill see the increase.

Three years after the tax cuts, the tax revenue returned to the 40 year average of 18.4% of GDP, with the lower rates So, no, lowering taxes will not immediately raise revenue, but it will increase GDP and help lower unemployment, which is what you need in a recession. The fact that they lowered the rates but are still collecting the same percentage of an increased GDP tells me that lowering taxes did in fact increase revenue, because historically the feds collect about 18% of GDP as taxes.

Summary: They lowered the tax rate, GDP grew and they still got their 18%. Sounds good to me.

Re:Surprised?

[TigerTime]

That's essentially what the whole Tea Party movement was about initially. It was a "what the fuck are you doing GOP party?" movement. Many Republicans value a fiscally conservative government above all else. Other value a socially conservative government above all else. The 1996 elections brought both sides of the Republican party together because they promised to reign in spending and be socially conservative at the same time. They won big. Over the next 12 years, the Neo-Republican Party that was in office went AWOL and started spending as if there wasn't a limit. They completely left the roots of their party's political motto.

That's part of the reasoning behind the huge 2006 and 2008 election loses for the Republicans. The fiscally responsible ones became disillusioned with the whole bunch and didn't want to vote for them. They were just as angry about the deficit growing from $4T to $8T.

As a fiscally conservative republican/libertarian, i don't give a shit if it's a republican, democrat, or the Pope himself. This spending spree in Washington has got to stop. And the tax code needs to be completely restructured. There are too many damn loopholes for the super rich and corporations to get around, all while the middle class gets raped because they make enough money to get by, but can't afford these big name tax consultants.

Now, I'm no fan of a lot of what the Tea Party has become. There are a lot of rednecks involved in it, and a lot of the socially conservative Republicans are trying to take credit for it and take it over. But if you really want to know what is at it's core and the root of it, you'd have to read Ron Paul's book The Revolution.

Re:Surprised?

[bunratty]

If looks to me like under Bush revenues went down and spending went up. It didn't seem to be a problem for Republicans until Obama took office.

Re:Surprised?

[CrimsonAvenger]

Do you have any idea how much our funding shortfall grew during the Bush + Republican Congress years?

$3.2 trillion.

$1.5 trillion or so during the Clinton years. (Dem congress for two years, Rep for the rest)

Note, for reference, that since the Democrats took over the Congress again, we've added another $4.5 trillion. Plus whatever debt we've run up since the last fiscal year ended, of course.

Neither side is without blame here.

Re:Surprised?

[tripleevenfall]

The two wars together have cost about a trillion dollars total over the last decade, which is about how much Obama increased the deficit in one year.

Re:Surprised?

[CrimsonAvenger]

Ah, the supply side fairy tale.

Yah, we should never have let John Kennedy fool us that way.

Or didn't you know that he was the first President to push for a taxcut (and get it) for the rich using that argument?

Oddly enough, however, for all that the argument is discounted, it's pretty hard to deny that tax revenues went up every time the supply side argument was tried successfully.

Alas, increased tax revenues never did much to control spending....

Re:Surprised?

[Beelzebud]

Deficits don't matter. --Dick Cheney
Funny how when Republicans were in charge they didn't care about the deficit. It's also funny that you say Iraq/Afghan were funded over the last decade as if they were paid for. They weren't. Bush also passed TARP and the tax cuts for the rich. He also passed his Medicaid bill into law without funding it.

Re:Surprised?

[Anonymous Coward]

Umm, bank bailout? You may think they paid it back, but umm actually no. And any that did still just drew interest on U.S. treasuries for quite some time.

Bush's wars cost us $1.6 trillion. Obama's stimulus bill cost us $800 billion. All the economists told Obama to spend double that, btw.

By & large, the stimulus bill kept states afloat and transferred some state debts to the federal government. You may complain all you like about the obvious moral hazard there, but the state's were all set to close shit down. And state run services actually impact people's lives, unlike most federal services.

It goes without saying that the federal budget could be fixed by eliminating the corrupt transfer payments, like farm subsidies, subsidies for military contractors, etc., but that'll never happen under either a Republican or Democrat administration.

In fact, the only progress that has ever been made was when Clinton actually implemented a fiscally conservative program just to embarrass a Republican majority. No Republican president, or even a Republican speaker, has ever put forward a serious fiscal conservative program.

I'll take the Republican claims of fiscal conservatism seriously when they make someone like Ron Paul speaker. Until then, the only formula that's worked has been a powerful Democrat in the white house and a strongly Republican house.

Re:Surprised?

[tripleevenfall]

We can argue about whether disagreeing with Obama's avalanche of spending means you endorse Dick Cheney, but I won't bother. Nobody is still talking about Bush 3 years later except those who won't judge Obama based on his performance. The point was merely to draw attention to the fact that the wars are not some huge percentage of the government's budget. At best, they are a few single digit percentage points or so annually, meanwhile, Obama is raising spending annually by ten times that amount.

Re:Surprised?

[schwit1]

Increasing income taxes to 100% would barley make a dent and would not keep up with spending. The only way to fix the problem is to fix entitlements, kill subsidies and fix the tax system.

Re:Surprised?

[jhigh]

Ugh...and to think that I just used my last mod points. I wish that more people understood this. Advocating higher taxes at this point is just pure political posturing being done by politicians without the willpower to cut entitlements. We do not have a "revenue problem," we have a spending problem.

Re:Surprised?

[jhigh]

How is it spending to not take in revenue? This is such dumb rhetoric. If I have a part time job and give it up because I want to spend more time at home, did I spend more money? No, I just gave up some revenue. It may mean that I have to do without some things, but I most certainly did not spend money by giving up revenue.

I really wish that people would actually think about the talking points that they're parroting before they regurgitate them...

Re:Surprised?

[Shivetya]

There is no bailout this year and Obama's budget is still EIGHT HUNDRED AND SIXTY TWO BILLION MORE just in deficit spending than Bush's last budget.

In all truth, does it really matter what Bush did? Are we such children that we can excuse our behavior by resorting to the old kid routine of "Billy did it" or "Mikey did that"? Is that what people have devolved back too?

Look, one third of his budget is DEFICIT spending. Meaning, we don't have that dollar and have to borrow it. We could tax all income over 250k at 100% and still not close that gap by half. Its impossible when spending is completely out of line with reality.

Why Clinton was successful is because he had real opposition in Congress. Newt and his gang back then actually meant what they said. Not this bunch of Washington insiders we have today who only care to keep their jobs. I am not taking anything away from Clinton, however the best thing that ever happened to him was for the Republicans to have complete control of Congress. It made both sides have to work with each other.

Obama doesn't have that advantage, or should I say we don't have that advantage. Obama has Reid which means he doesn't have to come to the table EVER. He can just let Reid keep any chance of good budget with hard decisions off the table which seems to be the hallmark of his Presidency, which is never to make a hard decision and get someone else to do it. Hence he is a failure.

What really goes without saying is that to fix the federal budget is that entitlement programs need to be addressed head on. This includes the new Health Care law which will only compound the issue. Until we get a President and a Congress willing to tackle entitlements we will never have progress. Instead they will play each side off each other with impunity come election day.

I am all for a smaller military, why should we defend Europe, Japan, and South Korea. They are big boys, let them pay their own way. Get out us of Iraq, we are done there. Carrier flotillas are just big targets and we certainly don't need as many as we have. Yet we must also cut deeply into Social Security and Medicare by reforming the process. Income taxes must be lowered at the top while at the same time taxing Capital gains as income. Simply roll capital gains into income taxes and be done with it, a nice 25% cap on income tax with both combined would sort the field out.

There are many solutions but none are going to get anywhere when we have a President who does not have to work with the other side. Reid gives him that out. So until we get both sides of government into opposite hands we are toast.

Re:Surprised?

[Anonymous Codger]

I wish I had mod points, I'd moderate you as -1, Brainwashed.

Angry at Amazon

[wsxyz]

Seems like Sen. Durbin didn't like the way Amazon treated his state. Now we'lll all get to pay tax on everything. Thanks a lot Amazon.

Re:Angry at Amazon

[WrongSizeGlass]

Seems like Sen. Durbin didn't like the way Amazon treated his state. Now we'lll all get to pay tax on everything. Thanks a lot Amazon.

Not just taxes, but higher prices. Setting up these tax tables is not an easy task. Some states tax specific items (such as clothing) while others don't. Some counties - and even some cities - add a % to the 'local' sales tax. Some states tax delivery fees. I could go on and on ...

These costs will be passed on to the consumers. And let's not forget that the sellers will be required to supply some sort of tax information to the consumers just in case the consumer needs to prove they paid the sales tax on their purchases (or didn't pay taxes because they are tax exempt in their own state). The states will need to perform long-distance sales tax audits on the sellers (and sales tax audits are a time consuming endeavor for the sellers).

Re:Angry at Amazon

[CrimsonAvenger]

The fact that, technically, federal income tax is unconstitutional,

See Amendment 16 regarding the legality of Income Taxes.

Re:Angry at Amazon

[Dan667]

durbin trying to screw Amazon and them not taking it is Amazon's Fault? They are only going after Amazon because Illinois has mismanaged their finances so badly.

Re:Angry at Amazon

[jedidiah]

> But stores have had to deal with this before the Internet anyway.

      Yeah. For a SINGLE jurisdiction: the one they happen to be sitting in.

> You had mail order catalogs and you had to pay sales tax when you used them.

        Ummm. No. Were you born yesterday? I mean really.

        The "mail order tax scofflaw" problem has existed for a very long time. In
some respects, Amazon is nothing more than an extension of the mail order
operations from the 1880s. The catalogs are just snazzier.

Re:Angry at Amazon

[jedidiah]

> All you need is a 3 column database for fuck's sake. Zip code. ...shows what you know.

At least a state-wide tax rate for all residents of that state done in a uniform manner would be somewhat manageable.

Although, this is ultimately a clear violation of the powers of the federal government. For once, this is an area where the ICC is actually applicable and is not just being beaten until it fits the square peg they want to cram it into this week.

Re:Angry at Amazon

[slashdottedjoe]

I agree. The web could be considered an electronic catalog and ordering system, but it is still mail order.

If you truly want to be fair, then it must go both ways. Every brick and mortar store should be forced to card every customer to determine where they live. They may be tourists that should have to pay sales tax for another jurisdiction. The B&Ms would cry like babies, if they had to do that. That is funny for they are asking web stores to do that for 7500 jurisdictions.

Level playing field

[Endophage]

I actually think this is a very fair move. While I'm not going to enjoy paying the CA sales tax it will at least narrow the gap that makes it so hard for brick and mortar shops to compete with online giants like Amazon. Many people buy produce at farmers markets to support local business, why shouldn't the same apply to buying electronics, books and everything else.

Re:Level playing field

[eqisow]

Because Best Buy charges $40 for a cable that's $4.99 with free shipping at new egg. Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery.

Plus, large scale online outfits are probably more "green" that brick and mortar stores anyway. They only operate some offices and warehouses and any delivery fuel usage is mostly offset by deliveries to a brick and mortar store plus the consumer driving to and from the store.

Re:Level playing field

[Archangel Michael]

Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery

First, it is call convenience.

Second, it is because people price shop the last 45 cents off a $1500 TV, but don't think twice about paying $35 more for a cable. A long time ago, I used to work in sales, selling printers that cost $450 that people would shop around on, and drive 90 miles to the next big city to save $5 ($445). I'd either toss in the 50 cent cable or sell them the printer at cost and the cable for $14.95. Yes, I made more on the cable than I did the printer.

Pretty soon, brick n mortar stores will die off and you'll never be able to see an item before you order it, and/or you'll be complaining about the walmartization of cities that destroy local mom n pop stores. I know way to many people who complain about $4.50 cables costing $40 at brick n mortar and buying online, and then complain about lack of good jobs locally. Funny how that works.

Re:Level playing field

[h4rr4r]

So there could be no good jobs if they charged $10 for the cable?
Somehow amazon can sell cables at a fair price, I bet they have some good jobs to offer as well. Their printers seem reasonably priced as well. I am sick of this buggywhip manufacturer cursing at automobiles bullshit.

Is working at bestbuy your idea of a good job?

Re:Level playing field

[Totenglocke]

OK, so lets say that this happens and all prices online go up by 6.5% (sorry, I forgot at first each state is different, but that's the sales tax rate in my state). Guess what - online is STILL cheaper. Why? Because their costs to operate are lower (fewer employees, less real estate to pay tax on, lower energy bills due to fewer buildings, etc). Seriously, look online - even before you factor in taxes (since sales tax in the US is added on at checkout) the prices online are usually a good 30% lower. So even if you pay the extra 6.5% (or whatever for yours state) at checkout, it's still going to cost you 30% less to buy online.

Just like how video rental stores like Blockbuster and Hollywood Video are dying / already died out in place of newer methods that are cheaper and more convenient, brick and mortar stores need to drastically reduce their presence in order to remain competitive or cut their profit margins. It's part of why Borders went bankrupt - you could pick a random Blu-ray movie and it would (generally) be $40 at Borders, $30 at Best Buy, and $25 (or less) on Amazon...and all of those prices are before sales tax, so that's not a factor. Just like how the US Auto industry got used to being able to charge obscene prices for equal (or lower) quality products, brick and mortar stores got used to having very little competition. Now that they actually have to compete and can no longer ass rape customers, they're screaming like children over the fact that someone is giving consumers a better deal and as a result, consumers are flocking to the better prices.

Re:Level playing field

[Hatta]

Dude, you know poor people spend a greater proportion of their income than rich people? That makes sales tax effectively regressive. If you want the rich to pay more (and I certainly do), tax income, property, and capital gains, not sales.

Re:Level playing field

[raddan]

Care to advance an argument instead of an unsubstantiated claim? Call me pedantic.

Re:Level playing field

[misexistentialist]

Yeah, those family owned businesses like Walmart that are lobbying for this bill really need our support! How about the Democrats get their buddies at GE to start paying taxes first before they expand regressive taxation that literally takes food out of the mouths of the peasantry?

Re:Level playing field

[samkass]

Because Best Buy charges $40 for a cable that's $4.99 with free shipping at new egg. Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery.

Plus, large scale online outfits are probably more "green" that brick and mortar stores anyway. They only operate some offices and warehouses and any delivery fuel usage is mostly offset by deliveries to a brick and mortar store plus the consumer driving to and from the store.

All that is fine and good. If they are more efficient and/or provide better value then they should win in the marketplace. But it should be a fair win, and the sales tax system shouldn't favor buying from out-of-state merchants.

Re:Level playing field

[smellsofbikes]

Second, it is because people price shop the last 45 cents off a $1500 TV, but don't think twice about paying $35 more for a cable. A long time ago, I used to work in sales, selling printers that cost $450 that people would shop around on, and drive 90 miles to the next big city to save $5 ($445).

This is an interesting claim. All the economics textbooks, some psychology textbooks, and watching newspaper articles, all say exactly the opposite: people, when asked if they'd drive across town to pay $25 less on a $100 item, say they would, but when asked if they'd drive across town to pay $25 less on a $1500 item, say they wouldn't. It's probably the classical example of human irrational behavior in economics. Now, it's possible that this is a testing artifact, and that they don't *actually* behave the way all economic models and tests say they do, but I'm a bit dubious and would like to hear what other people think.

Internet shopping was NEVER tax-free.

[Anonymous Psychopath]

Those who believe so are simply uninformed.

http://en.wikipedia.org/wiki/Use_tax

I'm on a Mexican Radio ....

[Archangel Michael]

If I were Amazon, I'd start thinking of moving operations to Mexico or Canada. Free trade that!

Re:no taxation

[BradleyUffner]

without representation

In case you haven't noticed, we all have senators and representatives elected by the people.

Re:Which state?

[ackthpt]

I didn't realize there was Federal Sales Tax. They have the constitutional power to regulate interstate commerce, but the Constitution prohibits its tax:

Art I, Sec 9. "No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another; nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another."

I don't think that clause says what you think it says. 'Preference' being the key word, this means the feds, if they created a tax it would be even from state to state, not taxing one more than others.

It needs to be a simple tax.

[Maxo-Texas]

Taxes out there vary literally at a county level.

However, if the tax on Amazon was set at a simple value "4%" it could work.

I get how Amazon is undercutting merchants. OTH, it's paying road taxes via gasoline taxes and lowering costs to citizens.

Re:It needs to be a simple tax.

[darkwing_bmf]

If only there were a machine capable of storing all of that tax data.

Re:It needs to be a simple tax.

[sqlrob]

County level? It's not that coarse. It varies by city / town as well in many places, even with in the same county.

Re:It needs to be a simple tax.

[segfaultcoredump]

There is, but it involves geocoding every single address. And then updating it every time any one of the 60,000 tax districts change their boundaries or rates.

Here is the problem, you can have two houses on opposite sides of the street be in two different tax districts. So a simple 'if zip == xxxxx, then tax = Y' type of lookup table will not work.

You then have the issue of the corporation needing to potentially apply for a sales tax license in jurisdiction before they can collect the tax.

Then you have the issue of having to possibly send the check to 3 or 4 different groups on different schedules for each customer in a different.

And finally there is the question of what gets taxed. In some states, some items are not taxed (usually basic food). So if I order a 10lb tub of powdered gatorade from amazon.com it may get taxed in one state but not another, both of which have a sales tax.

To call it a mess is an understatement. This is the main reason why the courts tossed out the states requirement to collect the tax: the burden was simply too much. If memory serves me correctly, that same court decision left the door open to enact a simplified sales tax scheme (if shipping to NY, then charge X% and send it to Y address and be done with it).

Re:Who's taxes?

[WrongSizeGlass]

It's pretty simple - you pay your state's sales tax (or in this case it's called 'use tax'). If your state doesn't have a sales or use tax then you don't pay anything extra.

Taxes. Pay them.

[Fuzzums]

As far as I remember, there is a reason to pay taxes.
Of course that is unless you want to pay every time you use a public road, pay the fire brigade right before they extinguish your house, pay the police to keep your neighbourhood safe.
Actually we pay for those things. It's called taxes. Pay them. And vote for people who spend them wisely.

Unless you live in California. Then the whole state goes bankrupt because the people don't want to pay taxes.

Terrible idea.

[sycomonkey]

This is a terrible idea. If they want to make it consistent, they should make it so that NO online purchases are taxed, regardless of state. Sales tax is a horrible system and should not be encouraged. What should be encouraged is online purchases. It is so much cheaper and more efficient than traditional storefronts, but if people are forced to pay sales tax on purchases that have no business being taxed, then that is going to lower the economic incentive to purchase online. As it is I don't think there's any constitutional leeway here one way or the other. Trying to enforce state tax laws at a federal level is a gross overreach of federal jurisdiction.

Re:Terrible idea.

[GlassHeart]

It is so much cheaper and more efficient than traditional storefronts

Arguable. A local store gets a relatively large shipment of merchandise to sell, so the cost (in terms of money, environmental damage, traffic, etc.) of shipping is spread over the entire lot. A customer may make several purchases (including from neighboring shops) on a single trip, which spreads the cost of driving over the number of items. Some customers might even walk or bike to the local store, or stop by on the way home, further minimizing that segment of the cost.

In the on-line version, if you buy everything from Amazon, in some cases they can hold shipment until all the items are complete, but in many cases even stuff you purchased at the same time are shipped separately. If you don't buy everything from Amazon, or if the order actually goes to some associate/affiliate (whatever they call it, those third party merchants) of amazon.com, then certainly they will ship separately. If you and your neighbor both buy something on-line, but one ships UPS and the other FedEx, then there'd be two trucks coming to your block instead of one. Not terribly efficient at all.

if people are forced to pay sales tax on purchases [...], then that is going to lower the economic incentive to purchase online.

Do you realize that this statement could not be true unless on-line shopping is actually less efficient and more expensive? If on-line shopping is really "so much cheaper and more efficient" even after taxes were properly assessed, why would anybody stop?

Bipartisan

[geekoid]

A possible co-sponsor is Sen. Mike Enzi, a Wyoming Republican who backed a similar proposal before and did not respond to a request for comment.

then:
Update 10:30 a.m. PT: I've heard back from Sen. Mike Enzi's office. It sent me e-mail this morning saying: "Senator Enzi plans to co-sponsor the Main Street Fairness bill with Senator Durbin. As far as a timeline or drafts, you'll have to check with Senator Durbin's office."

So it's bipartisan.

Don't even think it's only Democrats that raise taxes, or you will be school in tax history.

Re:Good.

[Jeremi]

There is a reason, in that applying sales tax rules is very hard

Hmm, if only there were some sort of device that could be employed in order to do perform this difficult calculation.

Re:Income Tax vs Sales Tax

[h4rr4r]

Neither one is a punishment. Taxes are the price of society. It is more sensible to take from those who can stand to lose it with the least amount of pain. Taking a few thousand from me might mean I go on one fewer vacation, from the working poor it would deprive them of all their disposable income if they have any. Ever noticed the scumbags that support these regressive tax systems are the ones who would benefit the most from them? No banker is going to support anything that deprives him of even a penny.

"We should tax foreigners living abroad"

[PolygamousRanchKid]

The Economist once wrote that levying taxes is like plucking feathers from a goose. You want to get the maximum of feathers, with the minimal of fuss.

So I am surprised that any Senator would dare to pick a fight with a rather large crowd of folks who buy stuff off the Internet. Start plucking that goose, and you will hear some loud squawks.

I'm happy to pay when it makes sense

[SuperKendall]

I gladly pay taxes on all sorts of local or federal things and am fine with it.

I am not happy to pay sales tax on good purchased out of state because there is no sense in it. Sales taxes are to help pay the state for overall services related to businesses in the community or state. But the state has provided zero services to the online merchant I purchased from. The only thing that makes a slight bit of sense is the use of roads to deliver packages but that is baked into taxes the shipping company pays and thus baked into shipping costs.

The state should simply not get money for every single expenditure I make no matter where I make it. Otherwise something I buy in an African market I owe tax for back in the states! Insanity!

Re:no taxation

[WorBlux]

A sales tax is a tax for the "privileged" of selling good or sevices in a "state". (like any reasonable adult would believe they really need permission to do business. As a sales tax it is imposed on the seller, and not upon the buyer. (It is a sales tax, not a buying tax) The seller usually find it most convenient to pass along the cost.

Clinton v. Bush II

[wytcld]

Clinton raised taxes, leading to full employment, an economic boom that for the first time in decades raised incomes from top to bottom rather than just at the top, and a budget surplus. Bush cut taxes, leading to a fall in employment, economic stagnation aside from the real estate bubble which was aided by Bush failures of regulation, incomes falling in all brackets except the top, and record budget deficits.

Sufficient taxes to support government programs lead to a healthy economy all around. The average economic performance is way better under Democratic presidents than under Republican. The notion that we can have a health country without sufficient taxation is like the notion that you can have a healthy body without sufficient food. History proves the Republican position that taxes must always be lowered, and lowered again, just doesn't lead to the Promised Land. It's a lie invented to serve the ultra-rich, who, having most of the money, have the most to lose from taxes. Average people, and the economy as a whole, prosper when taxes are higher.

Re:Income Tax vs Sales Tax

[h4rr4r]

You need to do some reading. The portion of a persons income which ends up as taxes will be much higher for the poor person under such a plan, because they must spend all their income. Much of it on things that are taxed in PA, gas, car repairs, etc.

The rich do not spend all of their income and under such a system that would exempt them from much of the tax burden.

A sales tax is aways a regressive tax. What we need is a reverse income tax, aka guaranteed income, and an income tax that has no exemptions. Before you call me a commie, I got that idea from Milton Friedman.

Rare!

[nilbog]

This is truly a rare thing to see - congress discussing laws that they are actually given permission to enact in the constitution. Interstate commerce.

Re:Income Tax vs Sales Tax

[h4rr4r]

So self interest is only ok if you are rich?

By the way, I make enough money. I have no desire to make more right now, I love my job and lifestyle. My concern is for the poor who would get screwed under the system he proposes. Only in the USA have I seen deluded poor people speak your words.

Re:Income Tax vs Sales Tax

[binary paladin]

I'll go with C: a government that doesn't spend money like a heroin junky. And it's the same principle too. The more they get, the more they need.

I mean if we're gonna punish someone for spending money on shit they don't need, it seems we should START with the government and not the citizens. Just a thought.

quit putting it on the US Taxpayer

[Dan667]

if they want more revenue how about they go after real corporations like GE, Exxon, and Bank of America that cook their books to pay no taxes. They have profits so where is the tax revenue.

Re:Federal law could make enforcement trivial

[sexconker]

It's not a new tax. It's not a tax increase. It's a new attempt at the enforcement of an existing rule. I predict that we'll have just as much compliance under the new enforcement as we do under the current honor system. As long as "zero" is a valid input for taxes owed on any form, people will put it in.

You are mistaken, a new federal law could make enforcement trivial. The feds could simply say you must collect the tax and pay it to the state, or the feds could allow a state to sue a company even if the company had no physical presence in the state.

I think the Supreme Court would have something to say about such a law.
Or at least I fucking hope it would.

The fact that you think this is a viable option is a testament to how fucking ignorant people are regarding the most basic separation of state and federal roles.

Re:Good.

[compro01]

There's already companies that deal with this stuff for you, such as Avalara. I used to work for a company that made point-of-sale software who worked with them. Nice slick system. They'll even deal with the paperwork for you.

Re:no taxation

[dgatwood]

Po-tay-toe, po-tah-toe. Technically, it is the sale that is taxed, not the business, and not the consumer. The fact remains however, that the business is responsible for paying the tax on the sale, regardless of whether that tax was actually collected from the customer, so by any useful standard, the business is being taxed on the sale, not the consumer.

I suppose you also think that the universal service fund cost recovery fee is a tax on phone users. :-)

Re:Income Tax vs Sales Tax

[h4rr4r]

Taxes are not stealing. They are paying for the resources of society that you use. Rich and poor alike use those, but some get more benefit from them and should pay more for that. I have a lot more valuable stuff to protect than a homeless person for instance.

I never called them evil, everyone is just looking out for themselves. No different than when the rich lobby to add tax exemptions.

Your income after taxes will be much higher than now. I have a degree and did work while getting it too.

So lets drive more business off shore.

[upuv]

Sorry but ever single time someone tries to put this stupid law up I see another politician who has no grasp of current economic forces.

The Internet has essentially removed geographical boundaries that enabled things like local sales tax. Sales tax can only exist if you are able to regulate ALL product sales in a confined geographical area. So you must either tax at point of sale or at point of entry into the geographical area.

Point of sale is simply impossible. As most markets on the web operate completely outside the jurisdiction of US law makers.
So this leaves you with essentially a manual customs inspection of every box coming into an area. And then processing each item and attributing tax and billing an appropriate party. This method would be prohibitive in expense and time. Effectively hand cuffing the local economy.
Lets not even start on digital goods which require no physical transfer at all.

There will always be massive holes in any system that tries to implement a sales tax on the web. The honest people will only be priced out of existence. Kill this law before it wastes any more time and money.

Sorry but the days of arbitrary taxation systems are gone.

Re:Income Tax vs Sales Tax

[vux984]

It's so infuriating to hear people like you try to make excuses for your greed and jealousy instead of just doing more with your life and earning as much money as you wish you had.

Its infuriating to hear people like you suggesting things that simply are NOT POSSIBLE.

An individual can work harder, and accrue more purchasing power relative to his peers. But it only works on an individual level.

As a "system" it falls flat on its face. What happens if EVERYONE who was poor jumped on your bandwagon and started "doing more with their lives and earning as much money as they wish they had"? I mean EVERYONE.

Simple: money is devalued and their buying power stays the same; aka price inflation.

Better still, as their collective production and value increases your own relative wealth and buying power decreases; as you are already "doing more with your life" and cannot "work even harder" by the same relative amount to maintain your relative advantage.

So your solution to the problem, if everybody got on board not only wouldn't solve the problem, but would more then likely take you down a notch in the process.

I prefer solutions that address the realtity that in any sort of capitalism the majority of the people will be at the bottom. If you move everyone out of the bottom, you just establish a new bottom, and everyone ends up in the same relative place.

So instead of vainly trying to suggest poverty is a problem that can be eliminated if only everyone worked harder its better to spend your time figuring out how to make the bottom livable, with as much opportunity for motivated individuals to escape it as possible.

Re:Good.

[Phoobarnvaz]

The online nontax phenomenon is a big part of the reason many states are floundering in debt.

This has very little to do with why states are floundering in debt. They thought the gravy train was going to continue forever and head up...up...up. When it didn't and they did not prepare for the day when times are bad...that is what caused this debt problem in the states.

You want to create more revenue in state and federal governments...you kill corporate welfare and force businesses to pay their fair share of their tax obligation. Quit giving away any type of tax break. If a business moves there promising a certain amount of jobs...pollutes the area or doesn't live up to their promises...you bust them the same as if a normal person were to renege on a deal.

Those businesses and wealthy individuals who believe they are above needing to pay their fair share are the reason this country is in the shape it's in...not individuals paying a few dollars of taxes on an out-of-state purchase. When the corporations and wealthy individuals pay their share...I will pay the "use" tax on any out-of-state internet purchases I might make without the help of a friend in a state with no sales tax.

Re:Income Tax vs Sales Tax

[ShakaUVM]

As a "system" it falls flat on its face. What happens if EVERYONE who was poor jumped on your bandwagon and started "doing more with their lives and earning as much money as they wish they had"? I mean EVERYONE.

Simple: money is devalued and their buying power stays the same; aka price inflation.

Bzzt. Economics fail.

But don't worry, you're in good company - most liberals don't understand this basic concept.

Imagine an economy in which there are 10 workers making a combined total of only 1 widget a year. At the end of the year, they all get paid an arbitrary amount of money (it doesn't matter how much), but only one of them walks away with the widget. All the rest do without.

Now imagine an economy in which the 10 workers each make 10 widgets a year, a total of 100. At the end of the year, they all get paid (again, the numbers printed on the money don't matter), and they will all end up with an average of 10 widgets each.

They all just got 100 times richer. How did that happen?

The answer: because their real productivity increased. In terms of money, they might all have been making $10/year in the first year, and $1/year in the second, but in real, actual measures of wealth, they all became 100 times wealthier. (Again, the numbers printed on the money don't matter.)

Inflation is what happens when you have extra money chasing the same amount of goods and services around. It does *not* apply when you have increased goods and services. If you could double the output of all factories on the earth, our real per capita wealth would double.

Socialists and liberals have a mental block when it comes to this very simple principle - productivity is *not* a zero-sum game.

Re:Income Tax vs Sales Tax

[cpt kangarooski]

No one has the right to someone else's money.

Why not?

A person's right to own property (including money) ultimately comes down to what they can personally defend or what they can convince others to agree to let them have.

Large groups of people have banded together, consensually established and empowered governments to serve their mutual interests, and generally they fund these by empowering the government to levy taxes.

This means that people don't have a right that is recognized by their neighbors to money that lawfully taxed and due to the government. This leaves them with the option of trying to personally defend their money from the tax man through force of arms, but it never seems to work out very well, because the government can bring a lot more force to bear if it wants to. Sometimes you can achieve better results by arguing as to how much, precisely, is owed, but this concedes that at least some taxation is lawful.

Apparently most people think that progressive taxation is the best way to go. I, at least, would say so. In which case a flat tax would be a bad idea, since the poor cannot afford to pay as much as the rich. The fairest thing to do is to shift the burden around to those who can best bear it. And after all, the rich benefit immensely from the government protecting their stuff (b/c they have more stuff), and from the poor not being so desperate that they just rise up and kill the rich, which is the kind of thing that historically happens when taxes are allocated unfairly.

Frankly, I cannot imagine any rich person with two brain cells to rub together who would prefer to not be rich rather than to be rich but with a progressive taxation system. Even if taxes are quite high on the rich, they're still doing pretty damn well. It's better than being poor under any taxation system. And a stable society is better than being dead.

If anyone here sounds greedy, I'm afraid it's you.

Re:Income Tax vs Sales Tax

[Hatta]

Now imagine an economy in which the 10 workers each make 10 widgets a year, a total of 100. At the end of the year, they all get paid (again, the numbers printed on the money don't matter), and they will all end up with an average of 10 widgets each.

Sounds like a worker owned cooperative. Quite good!

Socialists and liberals have a mental block when it comes to this very simple principle - productivity is *not* a zero-sum game.

Oh, we're quite aware of this. We want the pie to get bigger so everyone can have a fulfilling piece. The problem is that under capitalism, the workers don't walk away with 10 widgets each. The factory owner walks away with 100 widgets. Why make the pie bigger if you don't get a piece?