Republican Governors Seeking Online Sales Tax

Yes, you read that correctly: Republican governors are looking to tax your online purchases.

Instead of doing the hard work of cutting spending to line up with revenues, a handful of governors are now looking for the easy way out: taxing. Let’s forget the fact that higher taxes lead to less revenue (just ask California and Maryland), and assume that these states will magically bring in more revenue.

The Heritage Foundation’s David Addington explains what taxing online sales would result in:

  1. Impose undue state burdens on interstate commerce;
  2. Cause American businesses and individuals to pay much more to states in taxes;
  3. Discourage states from cutting the size, scope and cost of state governments, and;
  4. Discourage free-market competition

The reasoning behind the online sales tax is usually justified as a way to help “Main Street.” However, this is just another example of government picking winners and losers in the market. In the free market, consumers decide where and how they shop, and are free to find the best deal, which forces businesses to compete with one another in order to acquire such purchases.

But when government gets involved, those who are unwilling to compete in the free market are given advantages, by way of forcing their competitors to increase their prices, instead of the original business decreasing their costs.

As with most government schemes, the ultimate losers are the consumers.

Please Share Your Thoughts
  • craigwrigley

    As the owner of a small business, I fully support the implementation of sales tax for all online sales. My small company employs people through the ability to create sales. People can come in and shop at our store, determine what they want, and then go home and look for it onliine knowing they can save 8% or more in sales tax. This is the only reason whey they don’t buy in our store at the time. This is totally unfair to the small business owner located in municipalities throughout the United States who has invested much of his or her own money to create something out of nothing. If online sellers aren’t required to charge sales tax then neither should any brick and mortar business.

    • http://twitter.com/redigits Steve

      What you are asking for is protectionism. How about COMPETING and getting a better business strategy so you don’t have to rely on the government to punish consumers for choosing a better business than yours?

      “People can come in and shop at our store…” Yes, because you’re “trying” to force them to. Imposing a sales tax on businesses better than your own would mean you wouldn’t have to compete. You wouldn’t have to work as hard. Stop looking for corporate welfare and start competing! Just ask Best Buy; they have overpriced goods taxed at 6% and up and they have very little by way of strategy to attract customers to brick and mortar stores. Whereas AMAZON has an innovative strategy IN ADDITION to the lack of sales tax that drive sales online. Do you HONESTLY believe a sales tax imposed on online businesses will save you? WRONG. Online businesses will STILL out-compete brick and mortar stores because they offer value brick and mortar stores can never offer given traditional retail strategies.

      Thus, taxing online businesses will only hurt consumers and free market competition. It sure isn’t going to do much for brick and mortar stores except earn them a reputation of being protectionist because they refuse to innovate and compete!

      • craigwrigley

        It is not protectionism at all. It is an equal playing field. Why should I be punished for being a licensed local business and having to charge sales tax for a good or service and someone else doesn’t have to? The same rule should apply to all. If online doesn’t have to charge it then neither should I.

  • jimkress

    Then get your government to eliminate the sales tax. Don’t use the government as a weapon to plunder your neighbors.

  • Givendoly

    Just MORE Government interference in our business! WHO NEEDS MORE OF IT?

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