XPost: alt.destroy.the.internet, alt.fan.rush-limbaugh, alt.politics.usa
XPost: alt.tv.pol-incorrect

Much like the push for comprehensive amnesty and open borders, the
internet sales tax is something that seemingly nobody outside K
Street cares about, and to the extent that average citizens study
the issue, they are vehemently opposed to it. Yet at the behest of
large retail stores like Walmart, a number of Republicans have
decided to agree with Democrats to make tax increases on online
sales a priority, right before the November elections, of all times.

And as in the immigration debate, a number of lobbyist-oriented
“conservatives” are packaging this proposal with misleading
conservative rhetoric and arguments. Disingenuously naming their
proposal the Marketplace Fairness Act, they assert that this is an
issue of fairness and is free market-oriented because it treats
physical stores and online retailers the same. They also shroud this
in federalism, noting that the federal government is preventing
states from attending to their own affairs. They deny that their
bill would represent a tax increase, as they contend the taxes are
already owed to the states.

However, when we approach this issue from the perspective of an
average consumer and citizen, instead of that of a lobbyist, it is
clear that the internet sales tax scheme is anathema to conservative
principles on many levels and is particularly harmful in today’s
political climate.

True fairness and free markets

Proponents of the internet sales tax would have you believe that
there is some anti-market scheme to treat internet retailers
differently from brick and mortar stores. The reality is that there
is no special interest of “online retailers.” The internet is a
medium of communication, not a select industry. Any merchant can
choose to sell products online or at physical locations, and indeed
most retailers like Walmart have embraced internet commerce.

In this case, online retailers are in fact treated the same as
physical stores. For example, if a company owns a store in the home
state of the consumer, the company is required to withhold sales
tax. It’s just that the logistics of the internet, similar to mail-
order companies that got the Supreme Court’s ruling in the first
place, offers no logical and fair way to collect sales tax across
state lines if the company lacks a physical presence in the state.

One could rightfully disagree with the general structure of a sales
tax – the notion that a business should serve as the enforcer for
the state and collect taxes on the state’s behalf from the buyer.
But that is how the tax works for brick and mortar stores. It is not
directly levied on the buyer or directly imposed on the merchant;
the merchant is required to collect it from the customer on behalf
of the state. There is simply no sensible way to try to apply that
to purchases made online. The Supreme Court rightly ruled in Quill
v. North Dakota that an individual state has no power to directly
tax or compel tax collection from citizens of other states. A
business must be physically located in a state in order for that
state to require it to collect sales taxes on the state’s behalf.
This 1992 decision took place long before e-commerce became a factor
in the economy and was certainly not an unfair “handout” to online
retailers.

Furthermore, like any other choices in life, there are advantages
and disadvantages to different business models. The logistics of the
internet might make the tax burden easier for internet commerce, but
there is the drawback of shipping costs. That is part of doing
business, and with the advent of the internet, everyone needs to
adapt and innovate to stay competitive. Indeed, Walmart is doing
just fine. The internet has served as the great equalizer for
start-up companies that lack the economies of scale to compete with
the huge retailers. The notion that we need to raise taxes on online
retailers in order to level the playing field on behalf of the
Walmarts of the world is absurd.

The quintessential role of the federal government

The idea that states could collect sales taxes from companies in
other states is against the founding ideals of our country. Far from representing a case of federal overreach, federal bans on internet
taxation across state lines is the only proper use of the Commerce
Clause of the Constitution.

As James Madison noted in a letter to Joseph C. Cabell in 1829, the
“power to regulate commerce among the several States,” was “intended
as a negative and preventive provision against injustice among the
States themselves, rather than as a power to be used for the
positive purposes of the General Government.” Accordingly, it is the
proper role of the federal government to prevent states from
burdening the people with an unaccountable cross-state tax cartel
that can collect revenue from online retailers for 9,600 unique tax jurisdictions.

Hurting federalism and low-tax states

In their effort to impose a solution to a contrived problem of
“fairness,” lawmakers would actually be tilting the playing field
against online retailers in several ways, rather than flattening the
rules. Even though physical stores are forced to collect taxes from
everyone, they are only subject to the tax of the home state. So if
they are located in a state with no sales tax or a low tax, they
collect the lower tax, even if the customer is from a high-tax
state.

Under the Marketplace Fairness Act, online vendors in a state such
as New Hampshire would still have to collect the high rate of taxes
of customers from California. So red-state companies will have to
serve as tax collector for high-taxed blue states, thereby deleting
the benefit of being in a red state and blurring the effectiveness
of laboratories of democracy. It’s no surprise, then, that even
Democrats from states with no sales tax are vehemently opposed to
this scheme.

Onerous burden

This bill would also burden online businesses with the
technicalities of establishing a tax collection system that would
satisfy nearly 10,000 unique tax jurisdictions in this country. All
states and many localities have their own rates, exemptions, and
holidays. That is a recipe for killing jobs while raising the cost
of goods. It’s for good reason that in 1992 the Supreme Court
referred to such a scheme as a “burden” and a violation of due
process. Big online retailers like Amazon are willing to shoulder
this burden in return for driving smaller online businesses out of
the market or into their own platform. In that sense, this is a
consummate example for big government colluding with big business.
It should be called the Amazon Enrichment Act.

The fact that most versions of the Marketplace Fairness Act include
some sort of exemption for small businesses with revenue below a
certain threshold is a clear admission that their proposal is too
burdensome.

National sales tax

Collection, enforcement, and reciprocity of this tax would be so
complicated that it would engender yet another fix in the endless
cycle of government incompetence. The only way to effectively
collect it would be with a uniform national sales tax. There is no
question that the MFA would be the easiest way for liberals to
leverage their much sought-after national sales tax – an entirely
new revenue stream.

This is a tax increase

Proponents of the tax say that this is not a tax increase because it
would merely enable states to collect taxes already due. But in
reality, they are not collecting the tax. Why would we ever push for
new revenue and a new stream of taxation that will totally disrupt
e-commerce? Why not force states to cut government spending instead
of taking out more money from consumers? Since when did the
conservative solution to fairness and economic growth involve
raising taxes on some businesses? Let’s find ways to lower the tax
burden on brick and mortar stores instead of raising them on online
vendors.

Additionally, if states really feel that the revenue is due to them,
why don’t they go collect it? They have the ability to enforce “use
taxes,” a type of excise tax, on state residents who purchase
products online. Alternatively, they can create a new sales tax
directly levied on online businesses in the state. That would
definitely be more practical, less cumbersome, and beneficial to
low-tax states, many of which would be quite eager to attract online
retailers to their respective states. Clearly, the governors pushing
this tax lack the fortitude to directly raise taxes and instead want
the federal government to bail them out and create a cross-state tax
cartel, which voters of their state would have no ability to punish
at the ballot box.


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XPost: alt.destroy.the.internet, alt.fan.rush-limbaugh, alt.politics.usa
XPost: alt.tv.pol-incorrect

On 03/16/2018 10:05 PM, Ubiquitous wrote:

Much like the push for comprehensive amnesty and open borders, the
internet sales tax is something that seemingly nobody outside K
Street cares about,

It's unconstitutional to tax things transferred between the states.

We are a tax exempt trading union...

Laying export taxes on a State by any other States or the Federal
Government violates the constitution.

The only thing they can do is charge in state taxes when the sale over
the internet is all transferred within the States own borders, buyer and
seller are in the same State.

--
That's Karma

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