Re: Fed Internet Sales Taxes

[David Farber <dave () farber net>]

Begin forwarded message:

> From: "Ronald J Riley (RJR-com)" <rjr () rjriley com>
> Date: May 21, 2008 3:41:22 PM EDT
> To: David Farber <dave () farber net>
> Subject: RE: [IP] Fed Internet Sales Taxes

> Dave, for IP if you wish.
>
> John Levine <johnl () iecc com> said: "If online stores can't exist in  
> 2008 without an artificial 5% or 8% price advantage due
> to tax quirks, they're in the wrong business."
>
> This is making an assumption which is flat out wrong.  On small  
> dollar orders the shipping costs are often greater than the sales  
> tax and when making a purchasing decision I consider them to be a  
> tradeoff.
>
> On big ticket items shipping often dwarfs the sales tax (a riding  
> lawnmower for example) and one may prefer a local service provider.
>
> So charging sales tax on mail order items will put the mail order  
> provider at a serious disadvantage.
>
> Another poster already commented on the issue of company size.  Mail  
> order allows me to patronize smaller suppliers who often give much  
> better service than a large entity like Sears whose service is  
> downright atrocious.
>
> I own a farm and I cannot tell you how many times I have gone to a  
> local Tractor Supply (TSC) stores to find that they do not have the  
> item in stock.  Then they refer me to another store, say 30-50 miles  
> away.  When I get there they may not have it.  In one case I spent  
> the better part of a whole day going to a total of four TSC stores  
> to get the items I needed.  Needless to say I now order much of that  
> kind of product from a mail order supplier who has all the product I  
> order on hand and gets it to me in about three days without all the  
> grief.
>
> I see the same kind of crappie service at Lowes and Home Depot, both  
> of whom will keep you on the phone for twenty or more minutes just  
> to get a price and most of the time the person answering is not  
> knowledgeable about the products.  They often give wrong information  
> which causes me to waste time and money.
>
> It is a fact that all bureaucracies will grow to consume all  
> available resources.  Local establishments can effectively compete  
> by  having stock on hand and giving good service.  If they do not  
> stock what I need then why should they or local government profit?
>
> Ronald J. Riley,
>
>
> Speaking only on my own behalf.
> Affiliations:
> President - www.PIAUSA.org - RJR at PIAUSA.org
> Executive Director - www.InventorEd.org - RJR at InvEd.org
> Senior Fellow - www.patentPolicy.org
> President - Alliance for American Innovation
> Caretaker of Intellectual Property Creators on behalf of deceased  
> founder Paul Heckel
> Washington, DC
> Direct (202) 318-1595 - 9 am to 9 pm EST.
>
>
> From: David Farber [mailto:dave () farber net]
> Sent: Wednesday, May 21, 2008 12:13 PM
> To: ip
> Subject: [IP] Fed Internet Sales Taxes
>
>
>
>
> Begin forwarded message:
>
> > From: John Levine <johnl () iecc com>
> > Date: May 21, 2008 11:54:04 AM EDT
> > To: David Farber <dave () farber net>
> > Cc: "Patrick W. Gilmore" <patrick () ianai net>
> > Subject: Re: [IP] Fed Internet Sales Taxes
>
> > > > I hear this a lot and I always wonder: Will they tax 800-number  
> > > > orders
> >
> > > > as well?  They are the same thing, just two ways to get a company  
> > > > to
> >
> > > > mail you a product.  The "web" is just a way to remove the human
> >
> > > > operator from a mail order service.
> >
> > The Quill case, which is the 1992 case the article refers to, was  
> > about
> > paper mail order catalogs, presumably with telephone ordering,  
> > since the
> > catalogs that Quill sends me have always had a phone number to call.
> >
> > I've never understood why this sales tax question has been framed as
> > an Internet issue, when in fact it applies equally to mail order
> > catalog sales, which are still about the same size as online  
> > sales.  I
> > suppose online stores are new and sexy while mail order is so 19th
> > century.  But the tax issues are the same.
> >
> > Incidentally, I've been making the same points this article does for
> > many years.  A decade on the board of my village, including three
> > years as mayor, let me see up close and personal how unfair it is to
> > both the local services that are paid for by sales tax (most of our
> > budget goes to police, fire, and public works) and to the local
> > merchants who have collected the taxes all along.  If online stores
> > can't exist in 2008 without an artificial 5% or 8% price advantage  
> > due
> > to tax quirks, they're in the wrong business.
> >
> > Regards,
> > John Levine, johnl () iecc com, Primary Perpetrator of "The Internet  
> > for Dummies",
> > Information Superhighwayman wanna-be, http://www.johnlevine.com, ex- 
> > Mayor
> > "More Wiener schnitzel, please", said Tom, revealingly.
> >
> >
> > > > On May 21, 2008, at 10:11 AM, David Farber wrote:
> >
> > > > > Begin forwarded message:
> >
> > > > >
> >
> > > > > > From: Robert Atkinson <rca53 () columbia edu>
> >
> > > > > > Date: May 21, 2008 10:07:38 AM EDT
> >
> > > > > > To: David Farber <dave () farber net>
> >
> > > > > > Subject: For IP: Internet Sales Taxes
> >
> > > > > >
> >
> > > > > > Dave,
> >
> > > > > >
> >
> > > > > > A call in Wall St. Journal for imposing sales taxes on internet
> >
> > > > > > commerce:
> >
> > > > > >
> >
> > > > > > http://online.wsj.com/article/portals.html
> >
> > > > > >
> >
> > > > > > Excerpts:
> >
> > > > > >
> >
> > > > > > Real World Needs 'Net' Taxes
> >
> > > > > > May 21, 2008; Page B9
> >
> > > > > >
> >
> > > > > > Do you think that billionaire Internet moguls should continue to
> >
> > > > > > benefit from a tax loophole that hurts parks and schools, and  
> > > > > > makes
> >
> > > > > > it harder for your neighborhood bookstore to keep open for  
> > > > > > business?
> >
> > > > > >
> >
> > > > > > I didn't think you did.
> >
> > > > > >
> >
> > > > > > ***
> >
> > > > > >
> >
> > > > > > For starters, by giving online businesses a permanent advantage
> >
> > > > > > over their bricks-and-mortar competitors, it helps those who need
> >
> > > > > > it least -- huge, profitable e-commerce companies -- at the  
> > > > > > expense
> >
> > > > > > of often-struggling local retailers.
> >
> > > > > >
> >
> > > > > > In addition, the tax policy is regressive. It disproportionately
> >
> > > > > > benefits the upscale citizens most likely to shop online. Worst  
> > > > > > of
> >
> > > > > > all, as commerce increasingly moves online, state and local
> >
> > > > > > governments are being deprived of the sales-tax revenues they  
> > > > > > rely
> >
> > > > > > on to run schools, build roads, pay police and firefighters,  
> > > > > > and do
> >
> > > > > > all the other things they're supposed to do.
> >
> > > > > >
> >
> > > > > > A dozen years ago, one might have been able to make the case  
> > > > > > that a
> >
> > > > > > holiday on collecting sales tax would help the fledgling Internet
> >
> > > > > > get off the ground. I don't think that was particularly true even
> >
> > > > > > in 1996; it certainly isn't now.
> >
> > > > > >
> >
> > > > > > ***
> >
> > > > > >
> >
> > > > > > Opponents of the tax collection are fond of the effective but
> >
> > > > > > dishonest slogan that collecting a sales tax would amount to a  
> > > > > > new
> >
> > > > > > "tax on the Internet." But making Amazon collect sales tax on  
> > > > > > books
> >
> > > > > > is no more "taxing the Internet" than requiring stores to collect
> >
> > > > > > taxes on Valentine's Day chocolates amounts to "taxing falling in
> >
> > > > > > love."
>
> OCKQUOTE>
> > > > > love."



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