States Seeking Levies on Digital Downloads 249
evdubs writes "15 states and the District of Columbia currently tax online media, with others eager to begin their own taxes. The RIAA estimates that domestic sales totaled $503 million last year, but that figure doesn't include movies, e-books, online video games and other forms of digital media. Perhaps the most interesting point in this article is the way states, looking to start taxing online media, are trying to use the interpretation of previous law and apply it to digital media. In Washington, politicians are using their definition of software (already taxable), 'a set of coded instructions designed to cause a computer...to perform a task,' to justify taxation of online media because 'they cause some action by a piece of hardware to play them.'"
How will they possibly track this? (Score:3, Insightful)
Bang for the buck? (Score:5, Insightful)
Of course, there's the other perspective which has state governments looking for any means to plug massive budget holes, so to that extent they're probably just following the old John Dillinger line as to why he robbed banks - because that's where the money was.
Re:How will they possibly track this? (Score:2, Insightful)
Fact is, out government is run by common street thugs, and if they want your cash, they're going to get. No matter what, you're not safe in America.
Question (Score:4, Insightful)
Now many states have tried to get around the old method of taxing by creating "Use Tax." I saw this nifty little item when I filed my taxes this year. They basically want to charge you sales tax on items you purchased online and, in some cases, other states. The latter one bothers me because it is absurd to be taxed twice simple because you either moved or purchased items while travelling on vacation. The initial one is almost as absurd, since it relies heavily on them getting the truth out of you. If you do not claim to purchase anything online then it is sort of hard for them to say you did, short of tracking all your CC purchases.
The states have complained for ages it seems about the loss of money from online purchases. I personally think that while states might lose money, it actually helps overall economy. If people have to pay a few dollars less and not pay tax on an item (especially higher priced ones), they are more likely to purchase the item. Now if this item requires disposable or extra items (i.e. batteries, DVDs, etc.) you are more likely to get people purchasing those locally as well. In the end, the states still get money, they may just miss out on a small portion of it every now and then. Instead of sales taxing us all to death, raise liquor, tobacco, or hotel taxes to cover expenses. I enjoy the hotel taxes because I do not have to pay my local governments, the tourists do.
Re:Genius! (Score:3, Insightful)
Laughing at their profound incompetence (Score:4, Insightful)
None of the currently used media file types have any *code* in them that causes actions to occur.
The computers that have media players on them, have settings defined that tell the computer what to do when that media type is selected.
Someone should explain the difference between media and the device.
I can strip the entries out of the registry, and drop media files and even double click them all day long and *NOTHING* will happen, except that I'll either get a sore finger, or break my mouse.
Makes pefect sense to me (Score:4, Insightful)
Music is a set of instructions? (Score:3, Insightful)
Personal Property (Score:3, Insightful)
Does this mean then that we now own music we download, and can freely do with it what we wish!?
If so, tax away.
Re:Makes pefect sense to me (Score:5, Insightful)
No Taxation Without Representation (Score:5, Insightful)
1) No justification for the taxation is provided. There should be some underlying benefit to "We the people" for any taxation. i.e. I pay a hefty tax every month on my communication bill for various services provided to society, two of which are funding for communication access for the disabled and funding for communication access to rural areas. Levying a tax on downloaded media just because they can is not justification and depending on what they are considering a download it could be construed as double taxation since I already pay several taxes on the communication itself.
2) One of the concepts which jump started the United States of America was the concept of "No taxation without representation". Now I realize we have representatives in government who were voted into their positions by the people, however, if these representatives are not representing the interests of the people who voted them in and instead are representing the interests of the government or corporations then they are no longer representatives of the people. Before the American Revolutionary War the British argued that Americans did have "virtual" representation in parliament and therefore there was no need for American representatives to participate in the British government. We all know how that one turned out and virtual representation is no excuse today either.
I actually don't mind paying taxes, I think I enjoy many benefits from taxation here in the States, but I'd like to have some justification for new taxes beyond creative interpretation of existing laws.
burnin
Re:I don't get it (Score:3, Insightful)
Because the theory behind sales taxes is you're paying the government's costs for making that transaction posible. Courts, roads, infrastructure, etc.
When I buy something out of state and have it shipped or downloaded, my state government HASN'T DONE ANYTHING to support that sale. Why should they get a cut? At most they get a cut via taxes on my ISP bill, and (in the case of something shipped) fuel and business taxes on the shipper. There's a reason the Constitution prohibits interstate taxation of commerce, and this "use tax" bullshit needs to be called what it really is and struck down. If anyone deserves the sales tax on a sale, it's the state the seller is incorporated in (Which is currently prohibited, but there's better ways to get that revenue from the seller than a line-item sales tax)
Rob Peter to pay Paul, George, Fred... (Score:3, Insightful)
Isn't it the boost in government spending (read "waste") that is creating the budget shortfalls? Just like raising gas taxes, property taxes, sales taxes, cigarette taxes, liquor taxes -- it all happens because once lawmakers get their hands on those billions, they can't help but spend it recklessly, to the point of drilling an enourmous hole in the budget that John and Joan Taxpayer have to fill. This is just local government trying to find a way to cover its own ass by papering over the hole, when we all know any revenue generated by these taxes is going to simply be frittered away.
Maybe these state governments should try balancing their budgets first before bludgeoning their citizens over the head with more taxes.
People with money will be affected the most (Score:2, Insightful)
Slightly OT: I don't understand why more Americans don't go to the local library. Most of the music on my iPod was taken directly from the CD. I control the quality. The libraries have a very good selection of music, including huge box sets that cost over a hundred dollars from stores. If the library in your neighborhood doesn't have a cd you are looking for, they will check the county branches, and then even at the state level, and then send an email when the item arrives. I don't mind waiting 1 to 2 weeks to hold a cd in my hand and generate my own copy. Sitting at the computer searching mp3 sites, or bit torrent for an obscure song is a waste of time when the libraries databases are avaiable in the same browser.
"Personal property", eh? (Score:5, Insightful)
Does that mean that when you pay for a download and it disappears after a month or you can't move it to a different device, that the Kentucky government will prosecute the company responsible for violating your property rights?
Conversely, if the software makers can argue "this-software-is-licensed-not-sold", how could there be a sales tax?
Repeal the 17th and enforce the 10th Amendments (Score:2, Insightful)
How would this help out with concern to the current story?
Simple, many states are stuck with underfunded or unfunded Federal mandates. So the states look in ever nook an cranny for money. Yeah we would still have states taxing everything but the air we breathe but it would be far easier to avoid those states instead of being stuck where all of them are surragate collectors of taxes to fund Federal mandates that the Federal government had no real basis for doing.
Re:Makes pefect sense to me (Score:3, Insightful)
Maybe up North or out on the West Coast, but it won't happen in the Texas or Florida. Arkansas or LA won't either. Why? Think about why people need them. My mom has always had something that can haul 4+ kids and their stuff. You must be single or without any kids. Ask your mom if she and your dad would have gone on vacation or just run around town with your siblings in a compact or subcompact car or SUV if given a choice. My wife drives a Tarus and it just barely works. The truck is large for a car, but it doesn't work for elementary school kid's backpacks or sports equipment. I'd love a sub compact car myself, but I can't afford a car. I'm riding around after my last piece of crap car stopped working and took up a paycheck looking at it but not fixing it. You seem to think that I have money to afford a sub compact car for a daily commute, a truck for the times that we need to move stuff (which happens atleast once a month), and a passager vehicle for moving a family around. I'd have to get a truck rather than a compact car just because I would lose a function that I will need some time if I go another route. You may be able to rent a vehicle for a given trip, but I can't so I'd need that piece of crap 6+ year old used truck some one else has to get rid of because that's all that I can afford. If you really want to help the environment, make selling used cars illegal in your state. Almost any new vehicle would be better than the class of vehicles that I can afford that are all used and atleast 6-7 years old.
Re:Rob Peter to pay Paul, George, Fred... (Score:3, Insightful)
You mean other than the un-/underfunded mandates given to them by people who, unlike the state legislatures, get to borrow and endebt us to their heart's content?
So long as people continue to ask state governments to do more with less, the choice is always going to be between debt and taxes, and since many states are now constitutionally prohibited from endebting themselves...
"Just like raising gas taxes, property taxes,"
In case you haven't noticed, the population of the country (and, therefore, the states) is growing. More roads need paving, more homes are being built (or did you miss the whole "housing boom"?) and more people need to be provided with more services ("I want my intarwebs connection!"). The money has to come from somewhere.
"sales taxes,"
How many states with income taxes have raised sales taxes recently?
"cigarette taxes, liquor taxes"
How else are states going to fund Medicaid for people with now-useless lungs and/or livers?
"it all happens because once lawmakers get their hands on those billions, they can't help but spend it recklessly, to the point of drilling an enourmous hole in the budget that John and Joan Taxpayer have to fill."
Pop quiz: name your state legislators. What particular grievances do you have with your state legislature as a whole, if not your particular legislators?
It amazes me how much Americans will bitch about their state governments more than the federal government, all the while knowing far more about the latter than the former.
"when we all know any revenue generated by these taxes is going to simply be frittered away."
Ask the governor to use his line-item veto. Vote against your legislators. Organize a recall or two. Heck, run against them. Propose constitutional amendments. If you have specific grievances, you have far, far more recourse with your state government than you do wtih the feds.
"Maybe these state governments should try balancing their budgets first"
They do! Name a state, any state, and odds are I'll be able to find an article in that state's constitution that requires the government to maintain a balanced budget.
Re:How will they possibly track this? (Score:5, Insightful)
There are no victims, only volunteers.
"Back in the day", when Americans were not satisfied with the tax on goods, they threw the goods into the harbor. Reaction, more laws from the lawmakers. Next reaction, revolt.
I was speaking with a guy in his 60s the other day, and he was quiet and just worked for a living. He bluntly said to me, "I don't understand why young people put up with the shit that the government is doing today."
So, aside from PETA trying to keep poor frogs from being dissected* and the NRA wanting armor piercing bullets available for children, and the EFF, who stands up for their rights?
I speak with lawmakers, individuals, post stuff like this on slashdot and have it moderated down.
* I have a love/hate relationship with extremists. I guess they need to be extreme so that a decent middleground is reached, but frogs? I love frogs. I've had 1 tree frog as a pet, and 2 firebelly toads. Very interesting animals. But in the wild, frogs have about a 0.03% chance of becoming old enough to be dissected. Frogs/toads are pretty happy in captivity. A little water, a little girl frog for the boy frog to hug onto, some food, they sing at night. Cool stuff. But, we still need extremists, even though their rational is irrational, hopefully a decent middlegound can be reached.
Re:I don't get it (Score:3, Insightful)
Re:SUVs are self taxing. (Score:2, Insightful)
Except if you look at it from a supply and demand perspective, all those people driving turbo diesel 8.0 liter trucks getting 9 mpg and consuming all that gas is raising gas prices for everybody else too. If supply remains the same and demand goes up, then price goes up.