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With the Tea Partiers
Main Street Deserves a Level Playing Field
It is fundamentally conservative to subject online and brick-and-mortar retailers to the same taxes.
One of the basic principles of the conservative movement is that the market, not the government, should pick economic winners and losers. The only role that government should play is to ensure a fair and level playing field.
When it comes to sales taxes, that principle has gone out the window in the Internet age. Here’s an example: If you need a new pair of running shoes, your neighborhood sporting goods shop is compelled by state law to collect any sales taxes due. But the same is not necessarily true for a store selling shoes online.
Under current law, states are only allowed to mandate the remittance of sales taxes on retailers physically located within their boundaries. Which means online competitors can often sell the exact same shoes at a reduced price—no taxes included. (Technically, the shoes’ purchaser is supposed to declare and pay the tax directly, but you can probably guess how often that happens.)
You can understand how frustrated these brick-and-mortar shop owners are with their government. This tax discrimination tilts the playing field against them. The customer (and profit) goes not to the company that is most innovative or efficient, but to the one least shackled with taxes. In other words, the government is picking the winner and the loser.
Our government—at all levels—should treat Main Street retailers and online ones equally, as would be consistent with conservative principles. Thus far, Congress has refused to give up power and allow states to regulate in this area. But there is now a bipartisan proposal, the Marketplace Fairness Act, to give states full authority to set policies regarding collection of state sales taxes. This bill would not give any additional power to tax, nor does it encourage higher taxes. It simply allows for uniform collection of taxes that are already legally due. Conservatives need to embrace this proposal, which would put all retailers on equal footing, and then step back and let the market work.
Of course all conservatives embrace the concept of lower taxes for consumers, but not through carve-outs and special favors in the tax code. William F. Buckley, Jr., the godfather of the conservative movement, understood this growing problem, even as the Internet was in its infancy. In an article penned in 2001 and entitled “Get that internet tax right and don’t contaminate this medium,” Buckley described the status quo as inconsistent with conservative principles: “…if the advantage of tax free internet commerce marginally closes out local industry, reforms are required.” He suggested that online sellers of goods could be required to collect the sales tax and send it straight to the treasury of the state in question—which is exactly what the Marketplace Fairness Act, proposed by Rep. Steve Womack and Sens. Mike Enzi and Lamar Alexander, would allow.
There are wonderful conservative governors across the country who take their pledges to not raise taxes seriously. One such governor, Mike Pence of Indiana, advocated fixing this tax discrimination when he was a member of Congress. I trust Pence to tax transactions in his state fairly and at the lowest tax rate possible. Michigan Governor Rick Snyder has encouraged states to use this proposed authority only to impose fairness, and to offset any increased revenues with tax cuts elsewhere.
Taxes should be as low as possible, evenly applied, and as visible as fireworks on the Fourth of July. If everyone has to pay them and knows exactly what is being taxed, we have our best chance as conservatives to advocate their reduction. However our current tax code is a bizarre mixture of earmarks, carve-outs, and special treatment for politically connected interests, with the true level of taxation for everyday Americans hidden.
The tax discrimination in favor of online sales is unfortunately another example of a federal government that has lost its way by clinging to its power. Under federalism and the 10th Amendment, powers not vested in the federal government are retained by the states. Yet some conservatives are uncomfortable with this, because they fear blue state will become bluer, even less hospitable to business and freedom. But it is the genius of the Founders to have created a country that allows states to be a reflection of the values of the people who reside in them. Decisions that can be made by governors and state legislatures—who are close to the people and thus responsive to citizens’ needs—should be left at the state level. That is the heart of true federalism.
We should embrace, not fear, taking power back from Washington, D.C. States have famously been called the laboratories of democracy. As states with free-spending, out-of-control governments founder, Americans will vote with their feet and flock to the success found in red states. We have all watched as well-meaning conservatives, elected to Congress, find themselves essentially powerless to change the system, even with allied majorities and presidencies. This doesn’t mean we should retreat from fighting in the halls of Congress, of course. But our movement will achieve greater success when Washington can be bypassed altogether.
Photo: Wikimedia Commons
About the Author
Ned Ryun is the founder and president of American Majority, a political training institution. His “With the Tea Partiers” column run each month in the The American Spectator’s print edition. You can follow him on Twitter @nedryun.
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DrDog| 3.15.13 @ 7:01AM
Mr. Ryan,
Nice discourse but in laying out your scenario you forgot something -- shipping. In many cases the shipping costs are more than the sales tax. Now you shop on Amazon you may get the shipping free. But they are huge and have cut deals with the freight companies based on their volumes.
But lets talk Main Street. Many Mom & Pop stores also have an internet presence. With luck most develop 20-30% of their sales via the internet to customers they would never reach as strictly a B&M. But they are not an Amazon and won't get preferential rates on shipping. For them to pay full boat retail shipping for that end of their business AND sales tax too, will be a nonstarter and any legacy internet sales would just disappear.
Present all the facts Sir. The Internet is not the big bad bogeyman here, the sales tax is.
John Navratil| 3.15.13 @ 9:41AM
DrDog,
Adding to your commentary...
Amazon collects the sales tax in Texas as part of a deal they made with the state (long story). Still we buy from Amazon as most of what we need we already know; convenience trumps all. The broader question is, do we need brick and mortar stores? We do for food stores (more generally, anything we cannot wait for), things we need to examine, or services. Boutique stores are generally unaffected by on-line stores and chains such as Williams-Sonoma and Home Depot use both sales channels.
Much of the tax collected at B&M stores goes to fund city services which are unnecessary to the online store, and other taxes are collected as part of the commerce, itself. UPS and FedEx pay property taxes, fuel taxes, etc.
What has really happened here is that the convenient local government tax collector (the B&M store) is no longer in charge of the sales channel and local government doesn't like it. To conflate all this into a simple argument about an economic disadvantage to B&M store over sales tax is simple nonsense. The whole argument falls apart is sales taxes were reduced to what they were forty years ago when they were half what they are now.
C. Vernon Crisler | 3.15.13 @ 1:59PM
I agree that sales tax treatment should be uniform for brick and mortar vs. online stores. The key issue is nexus, i.e., location. Obviously, if a seller has no nexus with a state, it is engaging in interstate commerce and is exempt from state tax. Instead, buyers would be subject to use tax on the purchases.
Just as obviously, if a seller has nexus with a state, it has to charge tax on its sales. The real problem is that some large online retailers did have nexus with various states, but did not pay any tax to those states on their sales.
Another problem: a lot of brick and mortar stores took their sweet time about getting online, and were smoked by online retailers. That's changing now and most large retailers are catching up. You can buy products online and pick them up at the brick and mortar, saving shipping costs.
But fairness is fairness, and that's what is meant by formal equality: that we are all treated the same way under the law. That includes taxes. Is Ben Stein listening?
John Navratil| 3.15.13 @ 6:32PM
C. Vernon Crisler,
I don't, in principle, have a problem with taxing internet sales. What I don't agree with is that they should necessarily be uniform for B&M versus on-line sales out of any principle of "fairness". In Houston, one cent was added to the tax for police; another for the public buses. In the village in which I live (surrounded by Houston), we have no retail to speak of. Our police and fire is funded by property tax. Of necessity, my shopping is in Houston and I pay that penny for police services not provided to me.
I'm sure my little berg would like nothing more than to get their hands on another revenue stream, for nothing. Perhaps I should like that too. But I am inherently suspicious of yet another tax stream to the many sovereigns we serve.
What is needed here is some sense of what is being funded by these taxes and would should, reasonably, be assessed to on-line sales before establishing such a stream.
C. Vernon Crisler | 3.16.13 @ 12:57PM
I think you are not distinguishing between state sales taxes and city sales taxes. The above article was only about the former.
TLP| 3.15.13 @ 3:23PM
Navritil.
Contest at Monday's Wes Welker Story.
TLP| 3.15.13 @ 3:25PM
And, not for nothing?
If I have to Pay Ct. Sales Tax on a Car that I bought in New Hampshire?
Then everybody should have to Pay State Sales Tax on the Sex Toys they bought online, too.
I'm just sayin.
vtwin| 3.15.13 @ 11:35AM
DrDog, you’re forgetting something too - energy costs - you don’t have to drive to shop on the internet.
Moe Blotz| 3.15.13 @ 7:53AM
The shoe example has no legs here in New Juhsey where clothing items are not taxed.
Glen H| 3.15.13 @ 8:48AM
Change "running shoes" to "soccer shoes" and his example is valid. But who needs shoes if you have no legs?
TLP| 3.15.13 @ 3:30PM
Contest.
Helloooooooooo?
JP| 3.15.13 @ 7:54AM
The author essientially puts up strawmen. There are few brick and mortar companies that actually compete with "online" firms. Main St lost out a few decades ago to the box stores. Yes, there are book stores; but, even then Waldens and Borders did in most "main st" bookstores. Ditto for your neighborhood hardware stores (Lowes, Home Depot); appliance and electronic stores (Best Buy, TJ Max), etc...
Main St businesses have had to reinvent themselves. And offer services or products that the big boys cannot. They will never compete over price. I shop online usually because what I want I cannot find locally. Local commerce lost it many years ago - way before online retailers came about.
The idea of "paying your fair share", which is directed at online retailers, is really nothing but a proxy war between state governments and online retailers. We're back to square one - taxes.
PolishKnight| 3.15.13 @ 9:26AM
I remember 30 years ago hearing a Polish relative complain that his family grocery store was put out of business by a supermarket. So this has happened before. Back then, you'd go to different, small special shops to buy fruit, a butcher to buy meat, and a bakery to get your bread. Now you can even find your bank at the super-market.
When I go to Ukraine, I still see the small shops and kiosks at bazaars selling common grocery items at competitive prices but even there, times are changing. The benefits of running a small business for them is avoiding taxes. Unfortunately, you have to pay off the local mafioso. I laughed when I saw a Sopranos episode where Paulie tried to shake down a manager of JambaJuice and the manager told him that if he beat the manager up, corporate would simply send another one to take his place. "What's the world coming to?" Paulie cried.
JP| 3.15.13 @ 3:47PM
In my neighborhood, an old Belgian couple ran a family grocery store and butcher shop. It was failing because it could not sell enough meat and produce to like it did in the past. The children took a risk, moved the store into a more "gentrified neighborhood (the loyal Belgian customers died off and the children moved out) and opened up a chocolate shop gormet candy, coffee, and a sit down cafe) that catered to Yuppies. That was 12 years ago. The children now are opening their 3rd choclate shop. Their biggest problem other than counting the profits and ObamaCare and the Fat Polizei.
It's too bad that the old Belgian Market coudn't continue, but for the family the small business lives on.
vtwin| 3.15.13 @ 11:32AM
Agreed, Romany’s only “job producing” business investment Office Depot did produce thousands of minimum wage jobs while at the same time destroying thousands of small family owned businesses in our local communities. I get my office supplies from Amazon or eBay.
Ryan| 3.15.13 @ 12:47PM
OD I don't think pays min wage - at least didn't when I worked there 10 years ago. Of course, that was $7/hr
JD| 3.15.13 @ 3:23PM
Office Depot did more with less compared to those it put out of business, but Leftist frequently make the Obama "ATMs kill jobs" pronouncement: that productivity increases are bad for us.
They get this wrong because, as in all things, they don't understand cause and effect. They think "jobs" are the endgame. If jobs were the endgame, we should all turn Amish. Then we could slave away all day and barely meet our basic needs. We'd all be very well employed!
Jobs are a means to an end, with the end being wealth. Improvements in productivity, such as ATMs, increase the amount of wealth produced with a given amount of effort. This can only be good for a society. Either we work the same and get more, or we work less and get the same.
Problems with the allocation of resources, including labor, should not be blamed on productivity enhancements. They are social issues. A free market naturally flows towards maximum efficiency, but social engineers often cause painful misallocations of resources.
JD| 3.15.13 @ 3:24PM
Also, what kind of hypocrite bashes Office Depot for undermining jobs, then buys on Amazon and eBay?
Only a Leftist...
TLP| 3.15.13 @ 3:33PM
Exactly!
Go to Monday's Wes Welker Story.
We could use someone like you.
Tomper| 3.15.13 @ 8:16AM
State sales taxes are not uniform. Leave the internet alone.
Pecos Pete| 3.15.13 @ 8:24AM
Mr. Ryan: I beg to disagree with your sales tax proposal.
As DrDog (above) explains, the price differential is generally eaten up by shipping cost and local merchants can easily have an Internet presence that can offset their loss of sales to other Internet merchants. Another major differential is time and information. We can get delivery immediately at a local store; and, we can get help to ensure the product we are purchasing is the one we really want. There are other factors, but I want to move on to sales taxes.
Requiring Internet businesses to collect local sales taxes would be an extremely expensive effort. The business would have to know the current sales tax requirement for every taxing authority: village, city, county, and state. And then be able to change the sales tax rate immediately upon change by the taxing authority. Some have suggested that there be a national sales tax percent and that tax collection by the selling business would be sent to the federal government for redistribution to the buyer's state of residence; or, sent directly to the buyer's state of residence. This is better than having to maintain a large database of local, regional and state sales taxes. But is still illogical on many levels.
Pecos Pete| 3.15.13 @ 8:25AM
Anytime the federal government is involved with taxes they will want their share of the collected taxes. And, they will be able to ... at their will ... change the tax rate and change the proportions divided between the state and the federal government.
To keep this short, the real problem with Internet taxation is market freedom. The success of the Internet is a result of the free flow of information, as well as sales of goods and services. Once any government starts manipulating this free flow through taxation/regulatory schemes, then market imbalances will certainly arise to defeat the "do-gooder" intention to balance pricing (level the playing field).
Conservatives should, nay must, be opposed to any effort to increase taxes or regulation of the only free market-place remaining in the world (other than the black market).
PolishKnight| 3.15.13 @ 9:45AM
Sadly, Pecos, they already have. Ever hear of the DMCA? If you try to give your ebook to your daughter or alter your OS to improve it's performance, the feds could come knocking on your door. There was a fun futurama episode where a boy altered Bender to run faster and the police came to arrest him for "violating the license agreement". What license agreement? When did he sign one?
Crony capitalism wins again!
A federal sales tax is a bad idea. A state sales tax is bad but at least localized but the IRS would soon demand that you produce a sales receipt for every item you own including the toilet paper in the bathroom? Don't have one? Then you'll pay the tax and penalty ($250 minimum). You better have a big shoebox!
c. j. acworth| 3.15.13 @ 8:45AM
Here in New Hampshire we have no sales tax at all (or income tax for that matter). Go to the stores in towns that are near the borders and count the cars from MA., ME., or VT. Same dilemma, ain't it? Maybe the states should reduce or drop their sales tax to become competitive if they think their business is being hurt.
TLP| 3.15.13 @ 3:36PM
Exactly.
And, let's not forget how much better the States with No Income Tax are doing, than those with Confiscatory Income Taxes.
Florida and Texas come to mind.
JoeS| 3.15.13 @ 8:51AM
I shop online a lot, and sales taxes seldom enter into the equation. I shop online because I can search the inventory of what is available without ever leaving my home office. I can have it delivered here or I can pick up at the local store where it is already pulled and waiting for me. It is fast and convenient.
At other times I buy online because what I need is not available locally. I recently made a purchase from HomeDepot.com that was not in stock locally. It was shipped "free," but I paid the sales tax.
If local stores would develop systems in which I could search their inventory and reserve items online, I would do so. If they are losing to online sales, it is somewhat their own fault.
Case in point. I was out of town and had a home emergency requiring a new item. I got online, found it at a major retailer in my area, bought it and had it there when I got home. It was broken out of the box. I drove around and found one locally at a lower price and a bit better specification. Had the local store had an online presence, I would likely have made the initial purchase there rather that the online store of the major retailer.
As to the "use" tax that we are to pay on non-taxed purchases, I avoid non-taxed purchases for my business, but when I do, it is recorded and I pay the tax. I wonder how may of these local retailers that are complaining about the non-payment of taxes buy computers and other things online for their businesses and never pay the tax themselves.
TLP| 3.15.13 @ 3:37PM
Do you pay for Shipping?
Glen H| 3.15.13 @ 9:00AM
Ned Ryun is somewhat unclear on the concept. In most states you owe a use tax on items you purchase from out of state. It is the state's problem if it has difficulty enforcing this tax.
What Ryun advocates is making an internet retailer, which has no presence in the state and receives no services from that state, act as a tax enforcer for that state. What justification is there for doing this?
It is ludicrous for Ryun to describe the "Marketplace Fairness Act" as "true federalism" by giving up power to the states. It is exactly the opposite. New Jersey has no power to compel someone in Oregon to do something, unless the federal government steps in and mandates it.
JoeS| 3.15.13 @ 9:38AM
Answer the following questions reasonably and we will have found our solution.
I live in Kentucky and I buy a gift online from a store whose physical address is California. I make the purchase while I am traveling and staying at a hotel in Tennessee. The item is shipped from a warehouse in Nevada directly to the gift recipient in Indiana.
The questions:
In which state is this transaction taxed? Why?
What if the "store" is in Canada and it ships from China to a recipient in Great Britian?
John Navratil| 3.15.13 @ 9:49AM
JoeS,
And if I die driving home, before the item is received, does my estate pay taxes on it, too? ;)
TLP| 3.15.13 @ 3:38PM
It's taxed in the State you live in.
I bought a Car in New Hampshire, and I had to pay Ct. Sales Tax.
John Navratil| 3.15.13 @ 9:46AM
Glen H,
"In most states you owe a use tax on items you purchase from out of state."... And you are supposed to be able to get a refund from the state in which you purchased the item. The only situation where this works is for titled goods where the tax is paid when the item is titled.
JoeS| 3.15.13 @ 10:22AM
In my state, if I can show I bought something in another state and paid sales tax, then there is no use tax except on the differential when the other state tax is less than mine. If the other state charges more I owe nothing. It is a mess of rules and nearly impossible compliance.
I do not bother with keeping up with this. For those items purchased online for my business I do.
BShep| 3.15.13 @ 9:07AM
A parable.
Two people are walking down the street when a man wearing a mask steps out from the shadows with a gun demanding their money. Both victims empty their wallets. As the robber leaves the first victim turns to the second and asks why he is smiling. The second victim says because the robber missed the fifty dollars in his shoe. The first victim gets mad and yells for the robber to come back and take the fifty from the second man.
You, sir, are that first victim. Instead of being admiring of another victim’s ability to escape a tiny portion of the vicious tax burden, you wish to punish your fellow victim who managed to keep some of his own money out of a false sense of “fairness”.
You disgust me.
PolishKnight| 3.15.13 @ 9:55AM
I hate to agree with the commies (really, especially here) but they have a point that unless you can find a way to make government self-financing, you need to have a way for them to collect taxes. Or move to Somalia.
Simply fighting tax increases without taking a stand on spending plays right into the left's hands. They just borrow and blame the right. Demanding that the government provide services including police forces and the military but somehow expecting them to be "free" sounds as unrealistic as what the left proposes.
Government should make money off of fees like any other business. An income tax is a very leftist, corrupt approach to revenue generation. Income is an abstract concept defined by income after subtraction of allowed expenses and credits. It's rife with corruption. A simpler tax would be to charge a state fee to protect property similar to state property tax. A poor man with a shed and a wealthy man with a skyscraper would pay the same rate. The wealthy man wouldn't be able to use loopholes or "smurf" his tax via smaller companies to appear poorer. The poor man would still pay and feel tax increases.
BShep| 3.15.13 @ 10:48AM
This was about spending? Who knew?
My suggestion to Michigan (where I live) is not to enter into the agreement with the other states to collect sales tax but to offer to ALL online retailers the freedom from paying any other state’s sales tax if the retailer will move to Michigan. Heck, they could even limit the break to online retailers who locate in the city of Detroit. I hear Detroit has a lot of unused buildings and land for this type of stuff.
Michigan would have to hire more state police just to keep order at the borders what with all of the people trying to set up their businesses here. We could even allow online gambling too.
Why is the only option available always “rape the taxpayer”?
Ryan| 3.15.13 @ 9:13AM
I thought we were about starving the government. No thanks.
As someone who occasionally sells online for extra income, this proposal is bunk. Trying to figure out sales taxes in different states would be an onerous burden. It would actually restrict, not open, the free market.
I encourage all conservatives to oppose this bill which raises taxes.
PolishKnight| 3.15.13 @ 9:34AM
I'm surprised Ryan didn't address the wording of the author's argument: A "fair", level playing field. Define "fair". Socialism is all about defining what's fair and picking the winners and losers. Let's have a race but you give me a head start.
Sales taxes already are an onerous burden. Businesses have to calculate them at checkout and present a computerized receipt. Then they need to tally up the eligible sales taxes at the end of every month or so and send them in. If there was a barn door for onerous tax burdens, the conservatives let the cows walk through it a long time ago. Online retailers' financials are already largely automated so the calculation wouldn't be onerous. It's more a question of Constitutionality and I think that's already been settled although I find it interesting that the law seeks to impose sales based upon the resident. Logically, I would think it should apply to the online retailer's domicile. In theory, every online retailer would ship out of Delaware (purplish blue state.)
JD| 3.15.13 @ 3:16PM
There's room for talk of "fairness" in the same sense that we complain about the millions who have no skin in the game because they pay no federal taxes, but it's still basically the wrong angle. See my post near the bottom.
Mick Lee| 3.15.13 @ 9:26AM
Do you know why I shop online? Because I can't find what I want even in this big city (Indianapolis) anywhere. Plain and simple. The local retailers (even the so-called big box stores) cherry pick which items they will stock--leaving the rest to the devil. That may make economic sense to them; but they aren't doing me any favors. So when it comes to "leveling out the playing field", don't insult me. The local retailers aren't even bothering to show up at the game.
PolishKnight| 3.15.13 @ 9:39AM
Costco is doing very well by deliberately limiting their stock to the most popular items they can mark down the lowest. It's all about volume and their annual membership, baby.
For car and computer parts, I go online because I want the best prices and selection. A replacement strut I couldn't find for less than $65 I found online for $17. Heck, I could even service my father-in-law's Lada if he ever wanted to move here.
I still go to the big box retailers and super-markets for common items I need everyday but I go to a lot of specialty stores for a deadly sin: taste. My wife needs her Pelmeni and I need authentic Kielbalsa and Krakowian ham.
ncatty| 3.15.13 @ 10:05AM
More taxes to increase "fairness"? I thought this AmSpec.
George S| 3.15.13 @ 10:12AM
On line retailers ship. This creates jobs at, say, UPS.
UPS needs more drivers. They are hired and then pay taxes.
UPS needs more trucks. The increase in truck demand creates jobs at the truck factory... which creates jobs at the factory that makes the materials that make the truck factory which... which creates jobs at the factory that makes the parts for the factory that makes the parts for the truck factory...
UPS needs more aircraft which creates jobs at Boeing and Airbus (ugh!) which creates new supermarkets and restaurants and hardware stores in the vicinity of the Boeing plant.
The invisible hand of the market grows exponentially as the demand for a good or service increases, creating jobs and opportunities -- unless you are blessed with 99 weeks of unemployment insurance.
So go ahead and tax the sales tax and shipping difference. All you are doing is contracting the economy.
PolishKnight| 3.15.13 @ 10:31AM
If there's one job that is difficult to outsource, it's retail and shipping. If a healthy economy was retail and shipping, this country would be in great shape.
Havoc| 3.15.13 @ 10:15AM
Good idea. Let's not tax either.
WFStephen| 3.15.13 @ 10:54AM
The solution to the perceived inequity is not to force internet retailers to collect state sales taxes. Rather, it is stop requiring brick and mortar retailers to collect them.
Who Knows?| 3.15.13 @ 11:12AM
“But our movement will achieve greater success when Washington can be bypassed altogether.”
Yes, we need “Washington bypass surgery.”
The key word is bypass = “split”.
Dead people split the scene. Falling asleep is to split from the seen. Most Americans these days are essentially dead or asleep, when it comes to the scene in DC. Or, they deny the seen, and thereby split from it, while putatively awake.
You can split the profits, split the difference, split the rewards, split the credit, split the take, split your gut laughing, and even split up.
You can throw a split finger fast ball, split the atom, watch a split screen TV, or buy a car with bucket---split up---seats.
Being born is to slip out your mother’s slit. All the rest is details.
“Let no man rend asunder…” can morph into let’s split the scene = divorce.
We wander within the spilt milk, and it’s not ALL mother’s milk of kindness. What IS kindness?
“Kind” and “kin” and “kindergarten”? “Kind” = “child” in German, and “kin” hints at NO-split, aka relatives of the SAME progenitors.
“—ness” is just Being.
snipelee25| 3.15.13 @ 2:08PM
Sales taxes originally were collected to fund regulation and consumer protection for a particular good or service. Of course this quickly morphed into a general tax on commerce. One of the reasons that internet (and intra-state) sales were initially excluded is that there was no expectation that either state would do anything in the way of enforcement or protection. You are kind-of on your own. States cry "lost revenue" but as of yet have not come-up with a way to provide "services" for the taxes they desire to collect.
JD| 3.15.13 @ 3:13PM
I completely agree that it is unfair for government to tax online businesses differently than brick-and-mortar businesses.
I disagree that the solution is to increase taxes.
People here who are trying to justify different taxation of different businesses based on their roles or logistics or other factors are not making conservative arguments. These are Leftist arguments.
Enforcing sales tax is already so difficult that much of it is not collected. That is because it is an unwise tax. It is not an effort by government to collect fees for services rendered. It's part of the broad Leftist effort to simply collect as much as the voters will allow them to collect, by whatever means they can convince voters to support.
You cannot "fix" the sales tax to be fair any more than you can "fix" questions of what, if any, capital gains tax or inheritance tax or even income tax is "proper." People trying to answer these questions have accepted the fact that they are the right questions, and they are not.
Taxes which do not directly correlate to services rendered can never be fair. And they're not designed to be fair. Rather, government renders services whose benefits to an individual are difficult to compute, in part because they are deliberately complicated. Then it makes nebulous arguments about what everyone owes and proceeds to try to tax as much as it can.
We'll never win an argument on these terms.
PolishKnight| 3.15.13 @ 4:45PM
There's an old joke that illustrates the problem of libertarianism: I would like to be one, but I like roads and sidewalks.
Yes, in theory we could restructure society to make a perfect, libertarian utopia but that's about as realistic as Marx's utopia. There are numerous third world countries out there that middle class libertarians could move to and convert. Why don't they?
Trying to remake the USA into a successful libertarian system overnight is equally unrealistic. Simply saying that if something is politically impossible makes it ok to "stick to principles" and not do anything seems like a loser's excuse. Say what you like about the left, but they sure do know how to get results and isn't that the fundamental claim of capitalism/free markets? That it's about getting things done?
For me, I don't really care about worshiping the Constitution or free markets or socialism so much as We the People's interests being considered. I don't care whether it's a socialist or capitalist tossing me under the bus. I don't like being tossed under a bus. Leftists at least make a pretense of caring about their electorate and in many ways, they deliver. Being able to apply for a job with "women and minorities encouraged to apply" certainly motivates them to vote Democrat and doesn't cost a thing. One would think capitalists would figure out how to exploit issues that are economically inexpensive and even beneficial.
Joe D.| 3.15.13 @ 3:58PM
Ned, I understand your points. However, there is shipping costs involved. Also, if you are buying something like cloths you can not see everything you need to know at times to make the correct price. I think the no taxes levels the playing field for those defincies as well as others.
RJ| 3.16.13 @ 2:07AM
How much is this really an issue that the states can't deal with. In California, Amazon, after years of resisting state pressure, started collecting "use" taxes for sales made to California customers as of the first of the year. The use tax (same rate as the sales tax) applies to anything bought out of state which would have been subject to sales tax if purchased in state, but brought into the state one year from purchase.
Horsewhisper*3| 3.16.13 @ 11:39AM
Main Street deserves only to make its own playing field. If consumers are willing to sacrifice easy access, immediate purchase gratification, and ability to see, touch, try on products, there has to be more reason than avoiding taxes. The problem cannot be addressed by taxing services the government has no part, nor reason for one, in. It should keep hands off the Internet! Local merchants simply must make services and prices more competitive because it's the right thing to do for all concerned.
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