As we all know, the governor of Utah, Mike Leavitt, has proposed and is
vigorously campaigning for the taxation of goods and services purchased
over the Internet.
Mr. Leavitt is afraid that his state's revenue that is generated from
sales tax will decrease as more consumers move their shopping and
purchasing activities online. What Mr. Leavitt fails to see is that he is
proposing to maintain an antiquated system of revenue generation as the
world moves into the next millenium.
Those familiar with Mr. Leavitt's politics know that he has publicly
endorsed an expansion of the "information superhighway," deftly fooling
his constituents into thinking he is up on the latest innovations and
technologies. What Mr. Leavitt has also shown his constituents is that as
far as public policy is concerned, he is back in the Dark Ages.
It should have be a signal to everyone about how bad an idea this is when
Mr. Clinton backed the Internet taxation idea. Keep in mind that Mr.
Clinton is a member of the Democratic party, which always supports more
taxation and bigger government.
No tax is a good tax. Period. And an Internet tax is just plain bad.
Period. And there are myriad logistical problems associated with an
Internet tax. Here are a few:
- Tax revenue collection and distribution. Rather than have the
e-commerce sites, internet software development companies and so forth
spend their time trying to figure out how to handle this goliath of a
problem, these organizations should be spending their time improving the
software and hardware that run the Internet. State governments also
should not spend time trying to figure out how to do this -- they should
be working on solving the more pressing problems in society, such as
homelessness, welfare dependence, gang problems, and so forth
- Privacy issues relating to Internet taxation. Most Internet users are insanely jealous about
their privacy. How to properly deal with this issue is another thing that
companies and state governments should not waste their time on.
- International monetary issues. This is already a problem,
since many e-commerce businesses must have separate sites to handle their
businesses in different countries. Instead of trying to figure out how to
handle an Internet tax in addition to the currency conversion problems,
they should just worry about the latter.
As technology advances into the 21st century, shouldn't public policy do
likewise? The Internet tax proposal shows how backward-thinking and
uninventive our politicians are. They should be looking at the innovators
in the computer and telecommunications industries and developing
cutting-edge public policy. Taxation, especially Internet taxation is not
cutting-edge. As I mentioned before, it's something out of the Dark Ages,
and it's time for a change.
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