Destroying Internet Freedom by Taxation
Government taxation is as old as the first brute using
force to steal from those intimated by threats. So why should it be any different for the internet? In today’s political
environment of choosing winners and losers, the rush to tax online sales is gathering steam. Everyone feels the presence of
the Amazon behemoth. Retail outlets like Best Buys are rethinking their business model in order to compete. States are eager
to tap the flow of transactions with a sales tax that would cost consumers dearly. The issue of "so called" fairness
is the argument that bureaucrats love to hang their hat on. So who makes the valid case for exemption or inclusion?
Senator Jim DeMint made quite a stir in his article, No Internet Taxation Without Representation.
"The Marketplace Fairness Act recently introduced in the Senate would require online retailers to collect
and pay sales taxes to states where they have no physical presence or democratic recourse. Overstock.com, eBay and the like
could have to pay sales taxes to any state from which an Internet user placed an order, even if the company's headquarters,
warehouses and sales staff are located entirely in other states.
Such online sales tax proposals are taxation without
representation. The proposed federal law tells businesses that there is no escape from the clutches of tax-hungry politicians.
That concept is antithetical to our federalist system, which promotes competition among our states for the best economic policies."
push back from the bricks and mortar lobby comes from Michael P. Kercheval’s op-ed in the Wall Street Journal, Internet Taxation Will Help States
and Local Retailers.
"Sen. Jim DeMint's "No Internet Taxation Without Representation" (op-ed, Aug.1) is surprising and disappointing in that it is replete with outdated and inaccurate information.
What Sen. DeMint fails to mention is that in states with a sales tax—five don't have one—tax is already owed by
consumers when a purchase is made online. This isn't a new tax. It's erroneous to state that the Marketplace Fairness Act
would create "taxation without representation," as retailers don't pay sales tax, they collect it. The in-state
customer who makes the purchase and pays the appropriate sales tax has an opportunity every election to render judgment on
his state's fiscal direction. Furthermore, because of technology advancements, it is patently disingenuous to suggest that
collecting sales tax is a crushing burden for online merchants."
In a perfect society, a consumption tax would have merit, if the byzantine bureaucratic tax codes were used for a
proper bond fire. In an age of deficit spending and revenue shortfalls, this prospect is zero. So why give special treatment
to the Internet, when hungry government tax collectors want to apply their trade to cyber space? Maybe the better question
is why are we so willing to comply with state sale tax regulations, that only increase the retail price?
What other forms of internet taxation should the consumer expect in the future?
Laura Reynolds explains the history of the Internet Tax Freedom Act, which seems to be destined for oblivion.
"The Internet Tax Freedom Act (ITFA) of 1998 is an act of Congress regulating what kind of taxes may and may
not be placed on Internet use in the United States. It was extended as the Internet Tax Nondiscrimination Act of 2004 and
was extended as The Internet Tax Freedom Act Amendment Act of 2007. President Bush signed the current law, extending provisions
to 2014. The act forbids taxation of Internet service based on amount (bit tax), type (bandwidth) or use (email) in order
to make the medium affordable and accessible for commercial and personal use."
No "Bit or Bandwidth Tax" and certainly no "Email Revenue Enhancement" sounds like a sound policy.
However, the wheel of creative extortion never sleeps. The respected publication, The Hill reports in the FCC eyes tax on Internet service.
"The Federal Communications Commission is eyeing a proposal to tax broadband
The move would funnel money to the Connect America Fund, a subsidy the agency created last year to expand Internet access.
The FCC issued a request
for comments on the proposal in April. Dozens of companies and trade associations have weighed in, but the issue has largely
flown under the public's radar."
colleague Kurt Nimmo warns about the significance of this new tax.
"The scheme is nothing new. "Consumers already pay a fee on their landline and cellular phone bills to
support the FCC’s Universal Service Fund." The "Service Fund" was devised as yet another grand
socialist enterprise "to ensure that everyone in the country has access to telephone service, even if they live in remote
Who can be against extending the total Google/Facebook surveillance society at
taxpayers’ expense! Wiring the planet with a wireless net of shadowing observation goes well beyond compliance of tracing
sales, from your favored online merchant. The only valid duty that ought to be levied should target the snoops that are recording
your life in real time.
If there was ever a tool to liberate
the minds and spirit of mankind, the internet revivals the printing press. The freedom to connect worldwide is awesome. However,
the power of governments and corporatists to strip away your privacy and personality is frightening. Access to the web is
desirable for those who choose to make the connection. Even so, they must bear the risk and responsibility of linking into
the supercomputers of the snoops and spooks.
Yet, the practical
intrusion of internet taxation on any level hits, not only the pocketbooks of consumers, but finances the operations of the
total observation state. Debate if you wish the equity of sale tax exemptions if you are so inclined, but accept as existential,
the danger of accepting the mark of the beast for buying or selling.
Only an all-inclusive net of cyberspace registration would have the ability to tax everyone without exception. At
that point, it will not matter if Amazon has cheaper prices than Best Buy.
James Hall – August 29, 2012
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