A prominent taxpayers' watchdog group has warned Christmas shoppers this could be the last holiday season they shop online without states, counties, and cities making a big tax play for their holiday dollars.
National Taxpayers Union Vice President for Communications Pete Sepp says that groups like the Association of Counties and the Governors' Association are drawing up plans to impose "blanket taxation" of the Internet. He tells Conservative News Service those plans most likely go beyond existing sales taxes toward usage taxes and bit taxes.
"It's really a fairness question, too," Sepp tells CNS. "Because why would a firm that has no presence in the state be required to collect sales taxes when no real government service is being used that the local jurisdiction has claim on?"
He says states and localities should follow what he calls "a strict Nexus standard," meaning Internet purchases would be the only Internet transactions prone sales taxes as long as the purchase involves a customer doing business with a company located in the taxing jurisdiction.
"Otherwise," Sepp tells CNS, "it's just not fair - they're collecting windfalls that they don't deserve." And he says e-taxes won't be about helping Main Street or tax equity. "The only people they're helping," he says, "are tax officials and big spending politicians who want more money for spending programs.
"A lot of Main Street business have begun to go on-line themselves," Sepp continues. "I figure in five maybe 10 years, this whole distinction between giant people like Amazon.com versus your corner book store will probably be irrelevant. The only people that stand to benefit from this are those who believe in bigger government."
