Sunday, April 17, 2011

Internet Taxes

Sen Durban (D-Chicago Mob) is proposing taxes on all internet sales. As he asks:
“Why should out-of-state companies that sell their products online have an unfair advantage over Main Street bricks-and-mortar businesses here in Metro East?’’
Well, gee Dick, your cronies in the state government have burdened Illinois merchants with the second-highest tax rates in the country, and other states haven't done the same. Now somehow this is unfair? Businesses are moving out of the state and your neighbors are competing to bring them aboard.

What nest? A demand to make all state taxes equal to those of the highest taxer? They tried this in Europe, diplomatically demanding that Ireland "normalize" its 12% individual and 15% corporate tax rates, to something near the 35% rates imposed by Germany and France.

The Irish response was to normalize both the individual and corporate rates to 12%. The French had apoplexy. The Germans got the message and began reducing their tax rates.

2 comments:

Brad K. said...

Billll,

But - think of all the sales and revenue at risk for businesses and sellers located in Illinois, and selling to other states.

Since Illinois is nominally an 'important' state, commerce wise, don't they stand to lose more business and more revenue to taxes charged people located in other states?

The current rules - that the purchaser is responsible for filing 'use' taxes with their local state for any purchases made through the mail or on the internet where taxes for that state was collected, has been on the books for a bunch of years.

The big difference, is that today the proposal intends to violate privacy, raiding private records not kept by traditional mail order businesses.

And I am reminded of something relevant. I cannot recall a single database, from before computers, that the government has been able to maintain without compromise. If the government gets any information, it seems certain that their enemy and yours - as well as more government agencies than I can shake a stick at - get that data.

On balance, I have to disagree with general tax collection on the Internet, as unenforceable without undue government intervention and intrusion.

Oops. I forgot - the state governments just need to ask the IRS - who already has every bank record and money card record, without subpoena or need of warrant or warning or even asking or notifying. Thanks for that, President Obama. I will remember this little intrusion, come the next election.

Billll said...

"Fat Wallet" was an internet-based business based in Illinois. It is now an internet-based business based in Wisconsin.