Loading ...Although the debate around states taxing Internet and catalog sales has gone on for years, it has reached a new level of interest recently due largely to incidents involving online retailing giant Amazon. In addition, new laws have been proposed in both the Senate and the House in regards to these issues.
However, Adam Thierer, a senior research fellow with the Technology Policy Project at the Mercatus Center at George Mason University, doesn’t think that either of these bills offers an effective solution to the problem. He told WebProNews that these laws would essentially give states the authority to create a system for collecting Internet sales taxes, which he thinks would tax everyone at a higher level.
He co-wrote a paper with Veronique de Rugy and introduced 3 different approaches to the problem. The first option abolishes sales taxes completely. The second would implement a nationwide sales tax that would give states a certain portion of the income. While both of these serve as options, Thierer doesn’t favor either one.
Instead, he is pushing an “origin-based sourcing rule” that would tax consumers at the origin of sale and not where the destination takes place, which is the approach that the states are taking. Thierer told us that this method would help to increase tax competition between states, eliminate constitutional tax headaches, and keep interstate vendors from having to deal with complex tax systems.
Do you think this sounds like an effective plan?
How would the origin-based sourcing rule work for international web-based retailers? We have several “competitors” shipping into the US. They do this for both retail and wholesale customers and pay no taxes (either sales tax or personal property tax).
Considering the Euro model of VAT and what is being bantered by GOP candidates, how would that possibility impact the state-based taxes?
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This has NOTHING to do with “fairness” Just look at the Bill’s sponsors. Two flaming libs and an Arkansas Wallyworld Republican.
The simple fact of the matter is that libs can’t get enough of your money. They’d take every penny if they could and the Wallyworlds of the world are pushing this as a way do again drive the little guy out of business by making it so expensive & complicated to do business that the little guy can not compete.
If this country is ever going to get out of this Depression it’ll be on the back of small business, it won’t be because of wally.
Every dollar the consumer saves is a dollar he can spend in the local economy (or somewhere else) There are so many layers of taxes now that it’s a wonder the American consumer can afford anything.
Make no mistake about it, people make decisions based on taxes. They cross state lines to buy cheaper gas, cigarettes, other essentials, they move to places with lower taxes (see Californians moving to Wyoming where there is no state income tax) and all this will do is drive retailers out of the country to probably Canada & Mexico and they will sell & ship to the American consumer with no tax consequence. So the unintended consequence is to drive jobs out of the country.
Mr Idiot from Arkansas says in his TV interview that people research at the local store & then go buy online. What about the people that research online & then go buy at their local store? (because they want it in hand now)
This bunch that pushes for this ignores every Supreme Court ruling on the matter, tries to do anything they can to get around them, throws down more & more regulations trying to choke off anyone that makes a little extra $ selling on the web (or anywhere for that matter) and we wonder why we have the economic problems we have. Somehow this line of thinking is considered “scholarly” by some. Sorry, it’s just plain idiotic.
Origin based tax will not work because companies will just move to whereever the sales tax is cheapest ….And if that means moving to a sweatshop offshore…..If it saves them paying tax and being able to offer a cheaper product and increase profit…..why would they not go to taiwan to increase profit by 10%?
The only one of these three plans that would really work is the one with NO SALES TAX on web sales.
If we absolutely have to have a tax, then a National Web Sales Tax is then the next best option… but only if they DON’T also have to charge the state tax to in-state buyers and the state that houses the business is the one to get the tax instead of it being shared by all states. I feel that is a compromise to the origin based plan that would be a disaster… pushing business to states with no tax or out of the country completely.
It would put all USA based web retailers/sellers on a level playing field no matter what state they operate in while still giving states a way to compete through other incentives to locate in their state.
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I think this can be used as planned to try!
Ever wanted to learn Chinese? Now is the time.
I totally agree with what Craig said.
Sounds good, but I doubt that this has been introduced