E-Commerce Times Talkback

Re: Facing the Day of Decision on E-Taxes
Posted by: Paul A. Greenberg 2001-10-10 21:27:48

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In the midst of our national tragedy, some important due dates are likely to get lost in
the shuffle. Such as October 21st, the day the current ban on new Internet taxes will
expire.

Those with a lot to lose or gain from how the Internet tax debate concludes are trying
to make sure the deadline does not come and go without some action. The expiration of the
moratorium on online taxation was always looming as a date that could shape the future of
e-commerce one way or another, but now it has taken on a new urgency.

Re: Facing the Day of Decision on E-Taxes
Posted by: Cesar Moncada 2001-10-11 16:05:46 In reply to: Paul A. Greenberg

Taxes may be inevitable, but tax assessing can be delayed. What should guide that "delay" is the state of the state (or federal government). Specifically, states or possibly the federal government should determine what percentage of taxes they can afford to surrender toward helping e-commerce develop; then when that target is exceeded, inject taxation. This way, no arbitray deadline is set, state and federal government share in the process of investing in and building up e-commerce, and taxation can roll out on an as-needed basis. After all, why should South Dakota tax my purchases from there when they may only do 1% of all commerce over the Internet and Texas does 30%?

I'll expect Texas, in my example, has provided a greater investment in e-commerce and is "ready" to tax me for purchases arising out of Texas, rather than South Dakota, which may have a few more percentage points of investment in e-commerce to qualify to tax me there. In addition, not only does this method mete out the right to tax after properly set investment objectives by governments, but it also has the effect of creating state competition for e-commerce dollars and a feedback mechanism that some state(s) may not be doing enough to extend e-commerce and all its accoutrements like security, etc.

Setting an arbitrary date certainly is not as effective as encouraging governments to encourage e-commerce development. Let taxation be their carrot.

CM