Wisconsin will collect sales taxes on Internet downloads of music, games, books, ring tones and other video entertainment – a decision that angers some who will find the 5% tax added to their credit-card bills after Oct. 1.
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The change will require vendors to add the tax when the product is sold and remit it to the state treasury. One of the most popular sellers of songs, CDs and other digital products, iTunes, already collects sales taxes on those sales for states that charge it, said Susan Lundgren, a spokeswoman for Apple.It is expected to cost Wisconsin consumers about $6.7 million a year – a number that suggests it’s a $134 million annual industry here. Also, national experts estimate that downloads are growing by as much as 20% a year, which means the amount of sales tax in that area will grow substantially.
Doyle has been fighting for the change for years. He and other state officials say it is a matter of fairness: Internet vendors shouldn’t have a tax-exempt advantage over Wisconsin’s brick-and-mortar retail stores.
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But Republican Rep. Jeff Fitzgerald of Horicon said the tax on digital products will be charged on many non-entertainment products.“This new tax affects far more than kids downloading songs; it raises costs on all types of digital media from photos to clip art to computer games,” said Fitzgerald, who voted against the tax-increase package. “Graphic artists, photographers, printers and Web designers just saw their costs go up for producing content.”
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But Armata and others said they don’t want to self-report what they owe in sales taxes on downloads or get a notice from state tax collectors saying they owe a specific amount in unpaid sales taxes.
The pr0n industry is scared of this in New York. NC is considering it, too.
Remember years ago when there were proposals to tax each email you sent? Now we have to worry that Interwebitube illiterate pols will just make email illegal.
Found by Brother Uncle Don
Just another reason to pirate digital media. Thanks bozos!
Who’s going to pay for this attempt at recover but us? How many of us have ordered a big ticket item from Amazon to avoid a 9% sales tax? Yes I know on the state returns you’re suppose to list it, but honestly what percentage of people do. The states are desperate and are going for every penny of revenue they can grab. They don’t give a damn if it’s a regressive tax, they need cash today. My state is adding an odometer tax on top of the regular fuel tax. They’re afraid the hand full of hybrids are cheating them on road tax.
Since it is digital you can just say you are in a different state when you make the purchase…
Let’s see. The asses just passed an economic “stimulus”, and similar asses are thinking up ways of charging people MORE money when they buy things. Duh. Here in Kalifornia, you are supposed to declare all of the items you purchase from out of state so they can collect sales tax when you file your income tax. AND they raised the sales tax to 9.25%. No,no no. This is NO dis-incentive to spend money, not at all. Dumb fucks. I will be keeping all of my money from now on, since I have everything I need, except for food. That’s taxed next, unless you are an illegal alien or on welfare, of course. Country is off the rails, and we are in Depression. The US is failing day by day. Fun to watch, if you have your “stuff”. If you know what I mean.
In the state of California, if we buy stuff out of state, I was told we’re still supposed to pay CA sales tax anyway. I don’t know anyone outside of my employer who does.
I wonder if this current California law applies to digital stuff too?
Check your state’s tax laws you may be surprise that you have to pay tax on out of state purchases anyway.
In Oklahoma there’s a law passed in the 1930’s that required you to pay standard sales tax rates regardless of where you bought it, called a Use Tax. Now they’re enforcing it because its extra revenue in these tough times.
Huh. I’m surprised that the People’s Republic of Minnesota wasn’t one of the first on board with this one. Won’t be long I suppose.
Everyone wants to drive – nobody wants to pay for roads.
Everyone cries about local stores going out of business – yet the same people buy online to save a dollar, or to avoid sales tax.
None of you would buy something made in the USA if you can buy a Chinese item for dollar less.
Screw people like that!
Now, actually I use the internet to find small American shops and craftsman; I pay a premium, sure, but the customer service, durability and quality is leagues higher, and if something is in need of repair, I know exactly where to send it. I mean, really, just -try- finding an American made fleece jacket in a brick and mortar. I don’t have weeks to waste wandering through retail wastelands. . .
This plan strikes me as another Great American Boondoggle. OK, let’s kill a nascent industry, that many people can themselves participate in (i.e. J. Coultan selling his songs online, ect.) by ladling sales tax on top of something that is arguably more akin to a service. And let’s do that when a free and un-taxable alternative (BT) is available to everyone!
We really are lead by dumb fucks, aren’t we?
[Yes… yes we are. – ed.]
I don’t care. I don’t have money to buy stuff anyway. This is a tax on the rich. Good for them!
PS: I don’t care about high gas prices either. I’m broke.
Why, back in my day high gas prices didn’t matter because you walked!
Now, get off my lawn!
The internet is great because if you live out in the boonies you still get a great selection without having to drive a long way.
Notice that most of the states that have this, excluding the ticket republics of D.C. and Jersey, are ones with huge volumes of rural land.
If this makes money for these states an internet sales tax is not far behind.
#14, ‘dro,
Isn’t the internet free in Cuba?
#9, Get Real is correct. We all demand these services then refuse to support them.
I would like to see every on-line purchase taxed a nominal 5%. This tax would then be sent to the purchaser’s State, according to the delivery address for products and the ISP address for digital downloads.
There is no need to burden the State or the tax distributor with the names or specific addresses for each individual purchase.
Look at it as paying your responsible share of the National Debt. Oopps, my bad, I forgot. The right wing nuts and Leibermans idea of being responsible only applies to others.
# 16 Ralph, the School Bus Driver said, “This tax would then be sent to the purchaser’s State, according to the delivery address for products and the ISP address for digital downloads.”
And for those downloads out of country?
Florida has been taxing out of state Internet sales for years, but they haven’t started taxing downloads yet. Probably not savvy enough to realize that downloads are sales too.
There should be no tax on illegal downloads because there was no sale. Like Al Capone though, every illegal download creates taxable income and failure to list and pay that income is a tax violation.
All your stuff are belong to us.
Come to Canada where Canadians love to pay taxes
Provincial Sales Tax (PST) , Federal sales tax (GST) all to pay a host of useless cancer of bureaucrats.
You will get your taste with Mr. Obama
Here in Manitoba a poor sick person spent over 35 hours waiting patiently in the emergency ward of the major hospital – died – and finally when the inquest comes all the facts are “irrelevant”
#17, Paddy-O
1) give the tax to the home State,
2) don’t tax them,
3)or use the tax to support the organization that dispenses the tax among all the States.
I would prefer to see #3. That though, is just my opinion.
My local computer store is closing. He can’t buy wholesale for what people can buy on-line. The sad thing is they are great people and a solid part of the community. They sponsor a couple of local kid’s teams. They are leaders for the United Way. They offer prizes for the County 4H Fair. They pay taxes that help pave the streets, hire police, pay the volunteer Fire Department, plow the snow in winter and cut the Park grass in the summer.
#21 Your solutions will just drive businesses to create off shore companies that won’t have to deal with another layer of Gov BS…
# 23 Alfred1 said, “online retail should pay/collect all relevant taxes…just as offline retail must do.”
Offline retailers don’t collect sales taxes on downloads…
#22, Paddy-O,
If collecting a tax drives retailers off-shore then good. That will leave more of the honest ones here. What you forget is that all on-line purchases will have to be delivered.
That means they go through the border. That means they get inspected. That means they can end up being held, torn apart, inspected, or even lost. There is also the danger that purchases off shore have; especially complaining about defective merchandise, returns, payments and refunds, …
There comes a point where your “driving them out of business” scare just doesn’t work.
I hope this tax doesn’t come to Maryland at least they didn’t think of this tax when O’Malley Raised taxes in Maryland in 06.
If this tax happens in Maryland, I’ll just lie about my address.
They will now consider it tax evasion for downloading from torrents… There you go, its now illegal.
The following is my opinion:
This is old news. States did the same thing a couple of decades ago when mail-order became a hot market. Unless the mail-order stores had a presents in state, it seemed to be difficult for the states to keep book on them (Assuming of coarse, that customers didn’t pay with a credit card). The same “keeping book” difficulty may apply to Esales.
nunyac
Ya know, years ago taxes use to make sense. Like taxing gasoline and tire sales, to pay for road improvements. And “brick and mortar” retail sales tax, to help pay for some of the infrastructure that these require and use. But taxing catalog sales, thru the mail, was never justifiable. Because the P.O. already got paid to carry the merchandise. And with no physical store, at the buyer’s end, it couldn’t be argued that the sales tax compensated for roads, sewerage, or police and firefighting services. So why should there be a tax on sales taking place thru a wire (or fiber optic strand), for the same reason?
You can bet that these states AREN’T asking those annoying Telemarketers to cough up a sales tax, whenever they make a sale. And you can bet the credit card industry lobbies not to have to charge whatever interest rate, each state’s mandated Usury law dictates for loans. But just because the states’ governors believe it’s possible to identify buyers by their ISP’s location (Ok, who told them?). They figure a sales tax can be levied, so it should be. And just because it can. But no reasonable justification for why it should. Other than eRetail is costing them regular retail tax revenue. So it’s really just a matter of protecting a revenue stream, they’ve grown to rely on. And even though these business, like Amazon.com and the like, already pay taxes on their profits. These states still want to tax the customers for wanting to spend their income, that was also already taxes, to improve their lives in so small way. Like enjoying a book, or some music. Well here’s another revenue stream the states missed. Why not tax the children for wanting to learn in public and private schools? What’s the damn difference between reading a school book, and reading any other kind of book? Think of all the new books schools could buy if they taxed school attendance. Of course the states would have to actually be forced to spend that money, on education. Instead of tossing the proceeds into the “general fund” as they usually do. Which means, it rarely goes toward education. Like their Lottery sales profits.
# 25 Mr. Fusion said, “If collecting a tax drives retailers off-shore then good. That will leave more of the honest ones here. What you forget is that all on-line purchases will have to be delivered. ”
I’m ONLY speaking of digital downloads. Both of your suppositions are false.
#29, Glenn,
Your post makes no sense.
First, WE are the government. We go to the polls every couple of years and chose some representatives to speak and act for us. Maybe you don’t participate, but that is your problem.
Second, when WE decide on a program that needs to be funded, then the usual way to fund it is through taxes. It doesn’t matter what the program is or how the taxes are raised, these are a necessity in life.
The roads are used for more than allowing people to drive to the bricks and mortar store. They also allow ambulances and police to move around the city. They allow the people that live there to move around the city. They allow visitors to move around the city. Also note, the USPS does not pay taxes.
Taxing internet purchases is a legal form of taxation. The programs they support are duly enacted and legal. You might not agree with them, but that is why you should at least cast a ballot every election.
I don’t remember paying taxes for digital downloads in Jersey. I could be wrong since I don’t really buy a lot online. But a purchase is a purchase regardless so seeing tax on there doesn’t really phase me.