Comments on: Taxation Without Representation

By: Jeff

Jeff — Fri, 18 Apr 2008 17:51:53 +0000

Going VAT does seem to make more sense at this point but our system of taxes is heavily weighted in favor of states so just getting VAT implemented could take a full generation.

It might help on the property tax front but the fact remains that states have a problem with over spending rather than under taxing.

By: Dennis Howlett

Dennis Howlett — Fri, 18 Apr 2008 03:45:56 +0000

I was implying a VAT style system (I forget that language and understanding doesn’t always travel) and yes it would require an abandonment of sales taxes, otherwise it really is a tax raising measure by another name. I guess in some states it might help the property tax burden?

By: Jeff

Jeff — Wed, 16 Apr 2008 14:53:32 +0000

Dennis,
As you are aware, we don’t have a national sales tax, it is entirely at the discretion of states to tax commerce within their borders. But what Congress is contemplating is imposing a requirement on out-of-state retailers to collect a tax on cross border commerce.

From your comment I think you are misinterpreting this as the Federal government collecting taxes. The Feds get nothing here, this is entirely about states having the authority to collect sales taxes from merchants in other states.

Now if you are arguing that moving to a VAT style system or a national sales tax is prudent, I would not argue providing the states abandoned all or part of their state sales taxes as part of that bargain, or at a minimum simplify their sales taxes to be consistent with other states (as some have done btw).

And this is a tax raising measure, the states want to collect sales taxes on online commerce that they currently can’t touch.

By: Dennis Howlett

Dennis Howlett — Wed, 16 Apr 2008 14:43:58 +0000

Jeff – your statement:
“The Feds should stay out of it because the only thing that will happen if Congress requires online retailers to comply with the rococo like sales tax laws in all 50 states (actually not all 50 states have sales tax) is that we will see increased costs that are passed on to consumers in the form of higher prices in addition to the taxes collected from consumers.”

is a huge supposition. Yes, some states would pay more, but others less so in the round, the UnitedSA should end up neutral. Unless it is used specifically as a tax raising measure.

What about the scything of administration that would surely follow? A simple, across the board sales tax achieves that.

You’d get a lot of yelling from those invested in bureaucracy but if I was in power, it would be one of the first things I’d steamroller through.