Well, government just has to get its taxes somewhere. So you either tax the money the moment it's earned (income tax), or the moment it's spent (VAT, special taxes on gasoline, alcohol, tabacco...).
Income taxes can easily be enforced locally, but people don't like to have their hard-earned money taken away before they even saw it.
VAT and their likes _could_ be enforced locally, i.e. the place where the money is actually spent. So if I buy a TV in Luxembourg, I pay 15% VAT to the the local government, and if I buy it in Sweden, I pay 25% VAT. But this difference in taxes would create a shift of consumption towards the low-VAT countries, so the idea of locally enforcing VAT was frowned upon by several governments (usually in countries with a high VAT). Thus it never happend. VATs are due where you live, not where you spend your money.
"Tax-free shopping" is possible because of this. As a German citizen, you can buy that camera in Japan, get back that 5% VAT you payed, return to Germany, and pay the 16% VAT at the German customs . (Nobody does it and everyone claims that they had the camera before they left the country...)
Extending this idea of "pay VAT where you live" to the internet is only logical, as not doing so would open a loophole, and shops would go online just to save the VAT. Also, requesting that the individual customer pays his taxes (as it's done with tax-free shopping) somehow doesn't work as advertised, so goind after the businesses and requesting them to collect the taxes makes sense, in a way :).
Personally, I prefer VATs over income taxes, because _I_ can decide the time my money is taxed. If I want to save money, I can earn interest on my full income and I can pay the taxes the day I buy that new computer/gadget/house/whatever.
(On a sidenote, in Europe you usually see the prices printed including VAT, so nobody notices how much VAT they pay. You'd have to read the fine print on your receipt.)
Governments being what they are, obviously like to tax both ways instead of deciding on one sort of taxes. But I disgress...