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Democrats Your Rights Online

Wisconsin Governor Proposing Tax On Downloads 840

Posted by samzenpus from the click-and-pay dept.
Christopher Reimer writes "Ars Technica is reporting that the Wisconsin's governor is proposing a tax for downloads. From the article: 'Wisconsin's Democratic governor thinks it's not fair that tangible items get taxed while downloads, like music, ebooks, software, etc., go completely untaxed. So, he proposes to rectify the situation by having Wisconsin's 5% state sales tax apply to Internet downloads.'"
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Wisconsin Governor Proposing Tax On Downloads More

Wisconsin Governor Proposing Tax On Downloads

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  • Great! (Score:5, Funny)

    by infinite9 ( 319274 ) on Thursday March 10, 2005 @02:02PM (#11901253)
    Now p2p users can be charged with tax evasion!

    • Re:Great! (Score:5, Insightful)

      by Anonymous Coward on Thursday March 10, 2005 @02:10PM (#11901455)
      Almost, but not quite!

      5% of free is a whole lotta not-a-damn-thing.

  • Democrats vs. Republicans (Score:5, Insightful)

    by Seoulstriker ( 748895 ) on Thursday March 10, 2005 @02:02PM (#11901256)
    I think we should try to avoid the democrat vs. republican debate and just accept that the government is thinking about taxing the internet.

    Discuss.
    • It's the natural inclination of all legislatures to tax. Democrats tend to be a tad bit worse, but Republicans are no saints about this. So you are correct. The classification should be "politics" in general.

      • Re:Democrats vs. Republicans (Score:4, Insightful)

        by cayenne8 ( 626475 ) on Thursday March 10, 2005 @02:24PM (#11901659) Homepage Journal
        Geez....why can't the legislatures see we're freaking taxed ENOUGH. My paycheck is near 30%+ taxed with Fed, State, Medicare and fucking SS that I'll never get back fully. Sales tax here is like 9%...over and over and over again.

        We need to come up with some way, to make the politicians 'feel' each tax increase. Or possibly...for them to impose a new govt. program, they have to pick an existing one to scrap. Somehow put a cap on government....we don't need more taxes...we need smarter spending with what we have, and clean house now.

        Somehow, it seems that govt. politicians, are so abstracted from how every single tax steals money from their constituents. It must be something similar to casinos using chips instead of real money...it is much easier (among other reasons) to gamble chips that it would be to gamble with real greenbacks.

        We need to come up with some way for politicians to vividly see what each new tax does to people and the economy..in such a way as for the general public to see how they view it...

        Ok...rambling on...but, I'm sick and tired of a new tax here...new tax there...lets make it somehow capped off...and for every new tax and program in....there needs to be an old tax and program out to balance things...

        • Reminds me of a Dave Barry column where he was talking about how we should pay off the national debt. One of the ideas was to connect electrodes to politicians' bodies, then send a jolt through that corresponds to the size of the dept. With a little bit of tweaking the idea could be very effective in keeping tax increases to a minimum. ;-)

        • No, you are NOT taxed enough! Please read: (Score:5, Insightful)

          by Loundry ( 4143 ) on Thursday March 10, 2005 @02:51PM (#11902060) Journal
          Geez....why can't the legislatures see we're freaking taxed ENOUGH.

          You're a wage earner. You will never be taxed enough. Each dollar that the government seizes is one that it can spend on buying votes rather than you spending it on your "selfish whims" (you know, like feeding your family). Votes are for sale, and the means to buy them are government programs. Votes are the key to power. If you're a politician, then why don't you take someone's money and buy some? If the victim isn't going to vote for you anyway, then you've got nothing to lose!

          Both Democrats and Republicans play this hideous game. The ultimate long-term goal is to move 100% of the tax burden to a minority of citizens. That way, every tax increase will be immune from voter resistance. One side will be able to say to 51% of the electorate, "Vote for the other guy and he'll make you pay taxes!"
          • I hope the parent is moderated up as far as possible, but I am depressed to think that someone thinks of it as funny.

          • Re:No, you are NOT taxed enough! Please read: (Score:4, Insightful)

            by lgw ( 121541 ) on Thursday March 10, 2005 @03:16PM (#11902414) Journal
            Both Democrats and Republicans play this hideous game. The ultimate long-term goal is to move 100% of the tax burden to a minority of citizens. That way, every tax increase will be immune from voter resistance. One side will be able to say to 51% of the electorate, "Vote for the other guy and he'll make you pay taxes!"

            1% of the population already pays 33% of federal income taxes. Any across-the-board tax cut is met with cries of "33% of the tax cut goes to the richest 1%! Evil tax cuts for the wealthy!". What a system.
            • I should mention that the richest 1% in 2001 made 17% of all income. So their "fair share" would be 17%, not 33%.

              A system in which the majority says "we'll tax that minority more but not impose the same tax on ourselves" is quite simply immoral.

              • Re:For clarity's sake (Score:4, Insightful)

                by Gabrill ( 556503 ) on Thursday March 10, 2005 @03:38PM (#11902705)
                Parent post's (un)reasoning is simmplistic and uninformed. At $20k income, 17% taxes would leave $16,600 to live on. at $100k income, that same 17% leaves $83,000 to live on. (These are parent's numbers, not the actual ones.) The upper tax bracket has the means to lobby a straight tax line, but they willingly give up a greater share to Uncle Sam as a way to ease the burden on the middle and lower class. Don't worry, their tax lawyers are still dreaming up ways to deduct their gold plated 83" plasma TV's.

                • Re:For clarity's sake (Score:4, Insightful)

                  by CrimsonAvenger ( 580665 ) on Thursday March 10, 2005 @03:50PM (#11902872)
                  The upper tax bracket has the means to lobby a straight tax line, but they willingly give up a greater share to Uncle Sam as a way to ease the burden on the middle and lower class.

                  This almost made me laugh hysterically. Are you really stupid enough to believe that the upper tax brackets "willingly give up a greater share" "as a way to ease the burden on the middle and lower class"?!

                  If so, I have some great beachfront property to sell you in South Dakota....

                • Your math is good, but not sure I agree with the logic. I completely agree with the idea that the guy at $20k should not be taxed below poverty level, but after that why should a person be penalized because he makes more money. 17% is 17% no matter how you slice it. A person should be taxed more because he made more money (theoretically worked harder and was more successful). If you penalize people for making more money you reduce the incentives to go to college, be successful, etc.. Eventually it's m

          • Re:No, you are NOT taxed enough! Please read: (Score:4, Interesting)

            by magarity ( 164372 ) on Thursday March 10, 2005 @03:54PM (#11902923)
            Votes are the key to power. If you're a politician, then why don't you take someone's money and buy some?

            Congradulations, you've discovered the reason democracies over history eventually fail; the proletariat discover they can vote themselves "free" benefits from the public coffers and get into a greedy spiral until the system explodes.

          • Wrong. (Score:3, Interesting)

            by delmoi ( 26744 )
            People, in general, are too stupid to realize that voting for X or Y is going to save or cost them money in taxes. Look at all the poor people voting republican despite the fact that their tax burden is going up because of it.

            Now, what politicians actually do is give money to their campaign (and pro-them PACs and 572s) contributors, who then give them the money they need to stay in office.

            It's an inherent flaw in democracy. Unless you can think of a better solution, suck it up and pay your taxes, whiner.

        • Re:Democrats vs. Republicans (Score:4, Insightful)

          by bluGill ( 862 ) on Thursday March 10, 2005 @02:59PM (#11902186)

          Cause when it comes down to it people don't really want low spending. They want low taxes and all the government services they can get. Everyone has their own pet project they don't want to see cut, but they want everyone Else's project cut.

          Nobody is willing to say "Start with my items, and then compromise by taking everyone Else's too." Well they might say that, but look at how they vote. Anyone who cuts spending is attacked by the opponent next election, and likely to loose. Raise taxes and you are attacked and loose. Spend without taxing and people moan, but they won't vote against you. Politicians are well trained in what we want, and they give it.

          Try proposing cutting Nasa's budget on slashdot. (In a story where their budget is on topic, this comes up often)

        • Re:Democrats vs. Republicans (Score:5, Insightful)

          by Ironsides ( 739422 ) on Thursday March 10, 2005 @03:17PM (#11902426) Homepage Journal
          That's why you should have a flat tax with absolutely no deductions at all. Start with 25% and work your way from there. Then, no one can complain about how someone else isn't paying their fair share or that someone else is using a loophole. Also, with no brackets, you aren't having an auto increase in taxes every X years as inflation raises your salary (as the brackets stay the same). If the gov tries to raise the percentage you can ask them why they need a larger portion of the taxpayers money than before.

          • Who pays what in taxes (Score:3, Insightful)

            by whitis ( 310873 )

            That's why you should have a flat tax with absolutely no deductions at all. Start with 25% and work your way from there.

            A 25 percent flat tax rate would break the backs of poorer people. Here is the percentage of adjusted gross income that people pay in federal income taxes (source, IRS, 2003 figures:
            AGI TAX/AGI TI/AGI
            (dollars) (percent)(precent)
            0 to 15000 2.8 19.2
            15000 to 30000 4.3 40.6
            30000 to 50000 7.3 58.9
            50000 to 100000 10 68.2
            100000 to 20

        • Make people write a check so they can see how much they are actually taxed. Everything will then fall into place.
          • But we need the Withholdings to fund the War.

            If we lose, Hitler will run over Europe and Hirohito will take Asia. You know they're coming for America next.

            We have to fund the War somehow and it's only a temporary measure.

        • Don't know if this helps..... (Score:5, Funny)

          by p.rican ( 643452 ) <spammesilly@[ ]il.com ['gma' in gap]> on Thursday March 10, 2005 @03:28PM (#11902582)
          but it keeps things in perspective for me whenever I read it. This was sent to me some time ago but it still makes me laugh:

          Can you imagine working for a company that has a little more than 500 employees and has the following statistics:

          * 29 have been accused of spousal abuse

          * 7 have been arrested for fraud

          * 19 have been accused of writing bad checks

          * 117 have directly or indirectly bankrupted at least 2 businesses

          * 3 have done time for assault

          * 71 cannot get a credit card due to bad credit

          * 14 have been arrested on drug-related charges

          * 8 have been arrested for shoplifting

          * 21 are currently defendants in lawsuits

          * 84 have been arrested for drunk driving in the last year

          Can you guess which organization this is?

          Give up yet?

          It's the 535 members of the United States Congress. The same group of idiots that crank out hundreds of new laws each year designed to keep the rest of us in line.
        • Rather than looking at the internet as standing starkly in evasion of tax code, it should stand starkly as an example of why things people do or experience, should not be taxed. Taxes aren't the price you pay every time you take advantage of what a great country we continually make for ourselves; taxes should just be our equal burden for keeping the government running. The government is not resonsible for the existence and success of the free market; it should be separate from it.
    • I'm so sick of hearing about the democrat vs. republican debate. This has to do with over-taxing governments, not politics. Mod parent insightful!

    • Re:Democrats vs. Republicans (Score:5, Insightful)

      by jhigh ( 657789 ) on Thursday March 10, 2005 @02:06PM (#11901351)
      I agree that this is essentially a bi-partisan issue. However, I wonder if you would have posted this comment if the governor proposing the tax had been a Republican...
    • I say, if this is what the people of Wisconsin want, then they should be allowed to have it! God bless them for finding yet another source of revenue they can piddle away until they need another fix. Maybe they want to build an "art park" In Milwaukee to compete with Chicago in the category of ostentatious waste.

      I know this isn't a left-right thing, but I don't understand why a Democrat would bolster this idea, since I feel it is a tenet of the left to play hands-off with the net. At least, I consider myse

      • Re:Democrats vs. Republicans (Score:5, Informative)

        by Zuke8675309 ( 470025 ) <ty DOT zucker AT gmail DOT com> on Thursday March 10, 2005 @02:25PM (#11901694)
        I say, if this is what the people of Wisconsin want, then they should be allowed to have it! God bless them for finding yet another source of revenue they can piddle away until they need another fix. Maybe they want to build an "art park" In Milwaukee to compete with Chicago in the category of ostentatious waste.


        I know this isn't a left-right thing, but I don't understand why a Democrat would bolster this idea, since I feel it is a tenet of the left to play hands-off with the net. At least, I consider myself pretty far-left and I certainly think this is a foolhardy idea given the current disparities in tax policy. I tend to think this guy must be in the pocket of some special interests, or he himself stands to benefit in some way.


        I live in Wisconsin. The reason Gov. Doyle is proposing this (and a slew of other new taxes) is because he doesn't want to cut any spending to balance the state budget. His current budget proposal for the next two years (Wisconsin does two year budgets) projects a 1.8 billion dollar deficit. Compounding problems for him is that Wisconsin is already a tax hell and there is strong public support for a property tax freeze, thus he's looking for alternate ways he can raise taxes.
      • "tenet of the left to play hands-off with the net."

        There's where you are wrong. The only tenet of any politician is to increase his power base.
    • It is foolish to think in terms of Democrats vs. Republicans at this point anyway. Your allegience to whatever party you belong to doesnt' stop the fact that most of the money either side receives is from wealthy companies and individuals whos wants out-weight the general publice. Both parties do what is good for big business, albeit in different ways. The parent is right about this for sure, conceptualize it as rich people wanting to get and stay richer than you.

    • They're taxing sales, not the Internet (Score:5, Insightful)

      by jfengel ( 409917 ) on Thursday March 10, 2005 @02:26PM (#11901705) Homepage Journal
      Governments raise money to spend on roads, schools, and police with taxes. The money comes from somewhere; if you want those things you've got to pay for them. You may well be spending too much for what you're getting, but that's a separate issue.

      The question here is, what do you tax? It's easiest to raise money by taking a piece of the money every time it moves. Tax the money when it gets paid to you. Tax them money when you pay for something.

      You can also tax the stuff that doesn't move, like the property taxes on your house. Or you can "tax" for use: toll roads, for exampe. But nobody wants to pay for police on an as-needed basis, and we like the idea that everybody is guaranteed an education, even if they can't afford to pay for it.

      The article is suggesting that there are sales happening that aren't being taxes. Most states already try to collect taxes on physical objects, even if they're sold over the Internet, though the rules vary from state to state. They're trying to both increase revenue and be fair. The states really hate it when people buy stuff over the Internet, because that means that the money is being sent to another state; not only do they lose tax revenue but it means in-state businesses suffer.

      If you believe that they can tax stuff when it's sold, why not tax nontangible items? They already tax services; in most states you pay tax when the guy fixes your refrigerator.

      It doesn't sound like an "internet" tax to me. They're just trying to make sure that the Internet isn't any different a place to make sales than local stores are.

      • Re:They're taxing sales, not the Internet (Score:5, Informative)

        by TheFlyingGoat ( 161967 ) on Thursday March 10, 2005 @02:38PM (#11901868) Homepage Journal
        You're correct, but you're also unfamiliar with the situation in Wisconsin that is leading to this tax proposal. The governor is claiming to have a balanced budget without raising any taxes. He's also vetoing Republican legislation for a property tax freeze.

        At the same time, he's proposing this new tax and increasing spending. It's technically not raising taxes since it's a brand new tax, but logically it's the same thing.

        What this really comes down to is a wasteful government throwing money at different programs, increasing taxes for some of the highest taxed citizens in the country, and claiming that to do otherwise will be "hurting our kids education".
      • Well, what happens when you purchase iLife from Apple in California and have to pay the California Sales Tax, but then since you live in Wisconsin you have to pay an additional %5 on top of the tax you already paid?

        That's the problem that I see with stuff like this. You're going to start getting double taxed - once for purchasing in one state and again for using it in the state you live in.

        No more new taxes, no more increases in taxes. The government needs to make due with what it has (which is already

  • Yea Right. (Score:3, Funny)

    by squatex ( 765966 ) on Thursday March 10, 2005 @02:02PM (#11901258)
    That should be real easy to enforce.
    • That's right: it's voluntary. In a country that can trace its origins in part to a dispute about taxes, does this man really think that people are going to voluntarily pay a tax? And what makes it even funnier is that he thinks people in Wisconsin are going to voluntarily pay.

      There will be no "Internet Police" according to the article thus it will be the same as what most states (if not all) have now... Voluntary reporting of sales tax that you incurred while shopping out of state (via the Internet or ma

  • Psh, politicians. (Score:5, Funny)

    by RootsLINUX ( 854452 ) <rootslinux@gmail.cDEBIANom minus distro> on Thursday March 10, 2005 @02:02PM (#11901261) Homepage
    Is this really an important and pressing matter for the governor to concern himself with? Shouldn't he be more focused on.....I don't know, making more cheese? >_>

  • IANAL, but..... (Score:5, Informative)

    by thewldisntenuff ( 778302 ) on Thursday March 10, 2005 @02:03PM (#11901278) Homepage
    IANAL, but I thought this might violate the Internet Tax Freedom Act of 1998 (which was renewed in 2003)......

    However, this comes straight from the federal law -

    SEC. 1101. MORATORIUM.

    (b) Preservation of State and Local Taxing Authority.-- Except as provided in this section, nothing in this title shall be construed to modify, impair, or supersede, or authorize the modification, impairment, or superseding of, any State or local law pertaining to taxation that is otherwise permissible by or under the Constitution of the United States or other Federal law and in effect on the date of enactment of this Act.

    The funny thing is, the whole law is VOLUNTARY! Although I don't think it'll matter if they really want to get the money....If it comes to pass, they'll probably make a provision to make it mandatory

    -thewldisntenuff

    • Re:IANAL, but..... (Score:5, Insightful)

      by jkabbe ( 631234 ) on Thursday March 10, 2005 @02:08PM (#11901412)
      Keep in mind that there is a difference between "voluntary" and "unenforceable." They can't directly collect the sales tax (from downloads or from, say, book sales) but you are still technically breaking the law if you don't "voluntarily" pay the tax.

      Of course I am still of the opinion that this violates the commerce clause.

  • Does this mean (Score:5, Interesting)

    by the_mighty_$ ( 726261 ) on Thursday March 10, 2005 @02:03PM (#11901279)
    Users will have to pay tax each time they visit a webpage on a subscription based website? Visiting a page does involve downloading, of course.

    • Re:Does this mean (Score:4, Informative)

      by Minna Kirai ( 624281 ) on Thursday March 10, 2005 @02:13PM (#11901502)
      Users will have to pay tax each time they visit a webpage on a subscription based website?

      No, of course not. Calling it a tax on "downloading" is really inaccurate- it's a tax on "paying for downloads". Possibly, it could apply to a subscription website (maybe even preimum Slashdot), but if so, the tax would only be applied as you make the payment, not when you download each page.

      Suppose that Utah has a tax on ski resorts. They'd charge 5% at the time you buy the tickets- it would be stupid to suppose a tax collector would be stationed at the ski lift, collecting $0.50 each time a person rides up the mountain.

      Its generally much more efficient and less obtrusive to collect taxes at the same time another payment is being made. Otherwise, the government must hire a whole new collection-person, devastating the new income stream.
    • Technically, I pay a subscription to my cable company get on the Internet. If I go to an Starbucks, say, I might be getting on for free, but they are paying the subscription. This can be narrowed down to "paying to download websites." So, every page I download should be taxed.

      What the guy needs to address is what KIND of file can be taxed and what it means to buy something. If he means any file you pay for, there is trouble. If he only means certain kinds of files (say, MP3, for example), every time

    • Re:Does this mean - RTFA (Score:4, Informative)

      by LordEd ( 840443 ) on Thursday March 10, 2005 @02:29PM (#11901746)
      Read the article that the article is based on. The first thing it says is:
      Gov. Jim Doyle wants you to pay Wisconsin's 5% sales tax whenever you
      pay to download a song, book, movie or piece of art.
      Its a sales tax, meaning that some form of sale had to have occurred.

  • -1, Flamebait (Score:5, Informative)

    by SpiffyMarc ( 590301 ) on Thursday March 10, 2005 @02:03PM (#11901280)
    Article summary is wrong and intended to cause a flamewar.

  • Originating state (Score:5, Interesting)

    by Visaris ( 553352 ) on Thursday March 10, 2005 @02:03PM (#11901288) Journal
    Wouldn't it be hare to figure out what state the downloaded files were comming from? I was under the impression that states could only tax items purchased which originated in their state, is this true?

    • Re:Originating state (Score:5, Informative)

      by jkabbe ( 631234 ) on Thursday March 10, 2005 @02:11PM (#11901463)
      Many states have what they call a "use" tax. In other words if you bring something into the state (and "use" it?) that was not purchased in the state you have to pay tax on the purchase price. This allows them to circumvent the Commerce Clause and effectively charge a sales tax on out-of-state purchases.

  • Enforcement? (Score:3, Interesting)

    by kuzb ( 724081 ) on Thursday March 10, 2005 @02:03PM (#11901289)
    I wonder how he intends to enforce such a tax, considering any time your computer recieves data, it could be considered a 'download'.
  • It's not fair.

    Tax none of it. That would be fair.

  • Wisconsinite here. (Score:4, Interesting)

    by k96822 ( 838564 ) * on Thursday March 10, 2005 @02:03PM (#11901294) Journal
    Having lived here all but 1.5 years of my life, I can say this certainly doesn't surprise me. We know we're one of the most taxed populations in the union. We know our state government is corrupt and unethical. In a state that is almost entirely M$ dominated, it shouldn't be surprising the population is ignorant about the nature of the Internet. I'd be surprised if people put up a fight here about it.

    • Re:Wisconsinite here. (Score:4, Informative)

      by AKAImBatman ( 238306 ) * <akaimbatman AT gmail DOT com> on Thursday March 10, 2005 @02:16PM (#11901565) Homepage Journal
      We know we're one of the most taxed populations in the union.

      Actually, Dane County is one of the most taxed. The rest of the state isn't too bad.

      We know our state government is corrupt and unethical.

      Eh? Tommy Thompson did a damn good job of keeping things in order. The problem is that there has been no true sucessor step up, so the proceding governors have kept blundering along.

      (see: http://en.wikipedia.org/wiki/Jim_Doyle [wikipedia.org])

      In a state that is almost entirely M$ dominated

      You wish. It's a state that's IBM dominated. Most of the big companies still run the old mainframes and will happily pay for and install whatever nonsense IBM throws their way. CICS Java bridge, Websphere, WSAD, etc? Install it all! We need it!

      Not much creative thinking when it comes to computers. At least in Dane county, anyway. *sigh*

      it shouldn't be surprising the population is ignorant about the nature of the Internet.

      Nonsense. The rest of the state is quite well aware of the Internet. Dane county, OTOH, tends to have its head up its collective rear. Unfortunately, that's what happens when you have a very liberal University in the middle of an otherwise conservative state. The two kind of mix into this weird "we'll meet you halfway" type of arrangement.

      Don't get me wrong. Wisconsin is my home state and I love it. But Dane county has serious issues.

  • Not much of a proposal... (Score:3, Informative)

    by MLopat ( 848735 ) on Thursday March 10, 2005 @02:04PM (#11901302) Homepage
    Aside from the fact that any tangible item purchased on the internet is subject to sales tax of some sort, this new proposed law doesn't make alot of sense.

    From the article: "That's right: it's voluntary. In a country that can trace its origins in part to a dispute about taxes, does this man really think that people are going to voluntarily pay a tax? And what makes it even funnier is that he thinks people in Wisconsin are going to voluntarily pay."

    This new tax on downloaded items would be completely voluntary. How many slashdotters are going to lineup to pay more taxes for items that they already receive for free. Next!
  • And, Governor, that sucking noise you hear, are Internet jobs running out of the state!
  • What this country needs is a tax on taxes. You should be compelled to pay a 5% tax on your total tax bill.

  • as a resident of wisconsin... (Score:5, Interesting)

    by eobanb ( 823187 ) on Thursday March 10, 2005 @02:04PM (#11901311) Homepage
    ...I can truthfully say, I'm slightly scared by this, but at the same time, I have no idea how they'll enforce this. I caught this little gem in the article:

    There would be no Internet sales tax police, however, because compliance would be on the honor system

    Right.
  • If I give something away for FREE in Wisconsin does it get taxed? And for what reason should something be taxed on this basis? What does the Wisconsin state government do to support the e-commerce system?

    • Good luck Wisconsin (Score:3, Interesting)

      by rjelks ( 635588 )
      I'm wondering how they'll keep track of this. I just read how New Jersey residents were sent back tax bills for online cigarette purchases. So I could see, if this passed, downloaders getting back tax bills for ignoring the new sales tax.

      What happens when a Wisconsin resident has an out of state friend purchase mp3's, software, etc. and then just emails them (or mail them on a CD)? How could you possibly keep track of all of the shareware authors? Does this governor think he'll be attracting IT jobs?
  • I want that guy thrown off!

  • Why should internet sales be exempt from sales tax?

    Just because there's no purely physical end product, that's no reason for it to be exempt of sales tax.

    All power to him, I say.

  • Stupid, yet Illegal. Brilliant! (Score:5, Interesting)

    by Onimaru ( 773331 ) * on Thursday March 10, 2005 @02:05PM (#11901336)

    Okay, so this is obviously dumb, but I'll go one better. It's also probably unjustifiable and unconstitutional.

    The general justification put forth for sales tax is that it's a tax on doing business in the state and using the existing infrastructure of that state so to do. The internet doesn't really do that.

    Also, there's a good argument to be made that the Negative Commerce Clause [rnoon.com] prohibits this kind of action by a state or local government. In essence, Congress gets to regulate interstate commerce, not Wisconsin.

  • The power to tax is the power to destroy... (Score:4, Interesting)

    by GreyWolf3000 ( 468618 ) on Thursday March 10, 2005 @02:05PM (#11901337) Journal

    The Wisconsin government could theoretically shut down the local computer store, but it does not have the power to shut down out-of-state websites.

    If I lived in Wisconson, I would only be even willing to discuss the matter if it only applied to online stores located in Wisconson, not online customers. If someone drives over to where I live, they pay my local and state sales taxes when they buy stuff at a shop located in my community.

  • Sounds great! (Score:5, Funny)

    by Cytlid ( 95255 ) on Thursday March 10, 2005 @02:06PM (#11901346)
    That means I get a refund for uploads, right?

  • Don't go bezerk people... (Score:4, Informative)

    by Transcendent ( 204992 ) on Thursday March 10, 2005 @02:09PM (#11901434)
    This would only apply to things you pay for...

    It won't include free websites, e-mail, free software downloads, etc... just the software you download and pay for.

    Plus, this will only affect you if you live in Wisconsin, since states cannot tax interstate commerce.

  • Please pay tax (Score:3, Funny)

    by mrpuffypants ( 444598 ) * <mrpuffypants@gmailTIGER.com minus cat> on Thursday March 10, 2005 @02:10PM (#11901454)
    Thank you for loading this page to view the comments. Please send $1.00 to the Wisconsin Tax office for your GET request, which now applies under the new downloading law.

    Thank You.

    -The Wisconsin "We make the laws, you pay for them" Government

  • ahaha, honour system? (Score:5, Insightful)

    by Jailbrekr ( 73837 ) <jailbrekr@digitaladdiction.net> on Thursday March 10, 2005 @02:12PM (#11901483) Homepage
    While the while "voluntary" part of the bill seems to be quite silly, it is an insideous attempt to give an "internet tax" a legal foothold.

    It is difficult to implement a mandatory tax from scratch. It is much easier to take an existing "voluntary" tax and make it mandatory.

  • people pay M$ tax--why not us? (Score:3, Funny)

    by mojoNYC ( 595906 ) on Thursday March 10, 2005 @02:14PM (#11901520) Homepage
    the guv'nor must be thinking 'hmmm, these people *voluntarily* pay a tax to Microsoft, and get very little in return--i'd like to get in on that racket!

  • Simple: Double taxation (Score:3, Insightful)

    by TheCubic ( 151533 ) on Thursday March 10, 2005 @02:19PM (#11901597) Homepage
    It's _also_ stupid because it's obvious double taxation:

    1) You pay a company for broadband, and you pay the gov't taxes for that
    2) You pay the gov't for the only use of broadband

    'Creative' taxes are dumb. This coming from a state (MN) where the governor is all about 'creative' taxing.

  • Not fair (Score:4, Insightful)

    by Kohath ( 38547 ) on Thursday March 10, 2005 @02:38PM (#11901869)
    It's not fair that taxes are applied to a CD, but not applied to an iTunes download. Solution:

    Repeal the tax on the CD and cut government spending.

    A similar technique will solve all other cases of taxation that aren't fair.

  • Every state needs money and here's the solution (Score:5, Interesting)

    by hotspotbloc ( 767418 ) on Thursday March 10, 2005 @03:30PM (#11902604) Homepage Journal
    Legalize and tax marijuana instead. Seriously, between the 13 billion the US spends on the prohibition of marijuana every year (1) and the 20 billion in likely tax revenue (2) the US is missing out on a much bigger fish that's much easier to catch. Chasing down people to pay $.05 for an iTunes or ebook purchase is manpower intensive and I suspect has a low rate of return. You might as well pass a "swearing tax" and require people to pay a dollar to the State every time they use one of the seven dirty words. Putting aside the "fairness" issue some taxes are just much easier to collect than others. Marijuana, like alcohol, could be required to be sold with a tax stamp, at say liquor stores, making enforcement and collections rather easy. At a $1 a joint you wouldn't need to waste your time with the nickel and dime stuff. That's over 30 billion a year that could be spent on schools, paying off State debt, returned to the taxpayer or a combination of all of the above while using the existing alcohol tax system for collections.

    Besides, taxing interstate transactions is illegal under the "Commerce Clause" of the US Constitution (3) so it'll most likely be placed in within the State "use tax" category which has been very difficult in the past to enforce.

    Putting aside the fairness issue taxing ultra low dollar electronic purchases IMO just isn't worth it.

    (While many states currently do require a State issued drug tax stamp, because of marijuana's current status as illegal under prohibition few people actually purchase them. The "drug tax stamp" law is most commonly used to add the extra charge of tax evasion to a drug dealer and squeeze him for a little extra money and jail time.)

    1. Marijuana prohibition facts [mpp.org]
    2. Thinking about Drug Legalization [cato.org]
    3. Interstate Taxation and the Commerce Clause [umkc.edu]

  • sales tax is for GOODS not Serv ices (Score:5, Interesting)

    by DunbarTheInept ( 764 ) on Thursday March 10, 2005 @03:59PM (#11902986) Homepage
    The way most downloads you have to pay for work, you technically haven't bought a product. You've bought a service. Downloaded songs? You don't own your copy - you own the right to play the copy that you have stored but don't own. Software? You don't own the software, you just bought the right to use the copy of it you downloaded but don't own.

    You should never, ever pay a "sales tax" on a DRMed download becuase you haven't actually really bought a product - you've bought a service, and those don't get taxed as sales tax.

  • Possible work around? (Score:3, Interesting)

    by aztektum ( 170569 ) on Thursday March 10, 2005 @04:00PM (#11902992)
    If this catches on couldn't ITMS just charge you 20 a month for 20 songs instead of .99 per song. Isn't this how Napster already works -- a monthly fee for unlimited access?

    Then its a service fee to access their servers, not a "payment for goods".

  • Makes sense (Score:3, Interesting)

    by guacamole ( 24270 ) on Thursday March 10, 2005 @05:14PM (#11903917)
    How the sales of software or other digital products that can be simply downloaded are different from the sales of tangible goods that get shipped by snail mail? I think he probably has a good point.

  • In Other News.... (Score:3, Insightful)

    by Rolan ( 20257 ) * on Thursday March 10, 2005 @05:52PM (#11904361) Homepage Journal
    Ohio's govenor rises to second least favorite state politician...

  • Wow, (Score:3, Insightful)

    by e.m.rainey ( 91553 ) <erik@nOSpaM.rainey.name> on Thursday March 10, 2005 @07:02PM (#11905037) Homepage
    ...thanks for that bit of news which made me glad I don't live in such a backward-a$$ state as WI, that wants to completely screw up the internet. Yeah, go ahead an try it! Who would participate? How would it be implemented? Who would bother doing business with anyone or anything in WI anymore? Just plain stupid.

  • Double taxation? (Score:4, Interesting)

    by minion ( 162631 ) on Thursday March 10, 2005 @07:04PM (#11905054)
    Has everyone completely ignored the whole "double taxation" thing our country's Founders were against? We're getting taxes on INCOME that is being spent and taxed AGAIN. That is double taxation.

    Its time for a political uprising.

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