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Friday, May 23, 2008

Internet sales taxes

"Do you think that billionaire Internet moguls should continue to benefit from a tax loophole that hurts parks and schools, and makes it harder for your neighborhood bookstore to keep open for business?

For starters, by giving online businesses a permanent advantage over their bricks-and-mortar competitors, it helps those who need it least -- huge, profitable e-commerce companies -- at the expense of often-struggling local retailers.

In addition, the tax policy is regressive. It disproportionately benefits the upscale citizens most likely to shop online. Worst of all, as commerce increasingly moves online, state and local governments are being deprived of the sales-tax revenues they rely on to run schools, build roads, pay police and firefighters, and do all the other things they're supposed to do.

A dozen years ago, one might have been able to make the case that a holiday on collecting sales tax would help the fledgling Internet get off the ground. I don't think that was particularly true even in 1996; it certainly isn't now.

Opponents of the tax collection are fond of the effective but dishonest slogan that collecting a sales tax would amount to a new "tax on the Internet." But making Amazon collect sales tax on books is no more "taxing the Internet" than requiring stores to collect taxes on Valentine's Day chocolates amounts to "taxing falling in
love."
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