
Go ahead, pass the Internet tax. Your (foreign) competitors thank you. - QUFB
http://blog2.easydns.org/2013/05/07/go-ahead-pass-the-internet-tax-your-foreign-competitors-thank-you-in-advance/
======
gambiting
In EU internet purchases were always taxed, and yet online-only competitors
still manage to compete with brick-and-mortar stores very successfully. So
this article is quite bollocks.

~~~
cmircea
Everything was taxed, equally (with a few exceptions like food). No wasted
time figuring out which tax to use, keeping up with tax changes, arguing why
the brick & mortar store has a 5% rate while the online shop has 10%, etc.

Over the pond it's the same for everybody. Doesn't seem so in the US.

~~~
davidrudder
I think you misunderstand. The proposed changes are simply to remove the tax
exemption. State sales tax will apply to internet purchases, just like they do
for mail order. The confusion comes from the weird sales tax systems in place.
I live in Colorado where the sales tax rates change according to a maze of
Byzantine laws.

~~~
_delirium
The main thing the EU did to simplify that is require one set of VAT rules per
country. They can differ. For example, Denmark charges VAT on books, while the
UK doesn't. And, like with the proposed US legislation, it's based on
destination: if you order from amazon.co.uk to a Danish address, you pay VAT
based on Danish rules.

But what can't happen is a situation where Herning, Ishøj, and Copenhagen
charge different rates for different products. That simplifies the system
considerably.

------
rgbrenner
EasyDNS.. the company that closed my company's paid account over a month
before the term ended because I informed them we didn't want to renew. If they
think paying a modest sales tax is going to offset their terrible service,
they are dreaming.

~~~
StuntPope
I think I just sent you an email, if you don't get it can you drop me a line
at markjr [at] you-know-where

What you're describing isn't supposed to happen and I want to figure out how
it did.

~~~
rgbrenner
I got it... I'll get back to you in a bit.. I still have the emails from the
ticket.. I'll forward them to you.

I had a very positive opinion of EasyDNS before it happened.. I was lucky
enough to have already moved to another service a few days before so there
wasn't any site disruption... but your rep didn't know that.

Have 18 domains @ DME now....

------
mrgoldenbrown
This post seems to imply that we're considering a special Internet tax here.
Last I heard, the proposed bill was simply about removing the special
exemption Internet and mail order purchases currently enjoy. Since when is
there an additional, special Internet tax being proposed?

~~~
adventured
So re-frame it as the removal of the exemption. Makes no difference how you
spell that out, it adds up to an increase in taxes on goods sold / bought for
American companies.

~~~
dragonwriter
> So re-frame it as the removal of the exemption. Makes no difference how you
> spell that out, it adds up to an increase in taxes on goods sold / bought
> for American companies.

No, it doesn't. US buyers were already responsible for local use taxes for
remote purchases. This just shifts who is responsible for the taxes to the
retailer (if the taxing states opt-in, which requires them to adhere to
certain tax streamlining provisions and other requirements that make the
process simpler for retailers.)

This is a tax _simplification_ and _collection efficiency_ measure that
doesn't change the amount of tax due on any sale.

------
ojbyrne
This post is idiotic for at least 3 reasons I can think of:

1\. The tax is not "specific to the internet" but is designed to make it so
that internet-only businesses are required to collect the same taxes that
bricks'n'mortar businesses are required to.

2\. EasyDNS's right to sell to US customers is regulated under a giant
freaking, bureaucratic law known as NAFTA. If they every got large enough to
compete with large US corporations, they could become subject to all sorts of
mechanisms to ensure that US corporations can compete with them
(countervailing duties for starters). They should shut the hell up.

3\. Everything they say also applies to US companies selling to Canadian
customers.

~~~
dangrossman
Brick-and-mortar businesses collect, at most, two sales taxes. Even if a
customer from every single state walks in their door. They can engage one
local accountant and pretty much have all their questions about tax
classification of different products/services, filing requirements, etc.
covered.

Online retailers will have to collect, at most, 53 different taxes, under 53
different tax codes, remitted to 53 different entities all with audit rights.
That's not really _the same_.

~~~
dragonwriter
> Online retailers will have to collect, at most, 53 different taxes, under 53
> different tax codes, remitted to 53 different entities all with audit
> rights.

More than that, actually; I have no idea where you get 53 from; the relevant
entities ("states" as defined in the MFA) include the 50 states, the District
of Columbia, 5 named territories, and "any other territory or possession of
the United States."

But its not just "online retailers", its any remote seller. Including anyone
who does online and/or mail and/or phone sales, which includes lots of
entities that are also brick and mortar outlets. But only if they choose to
sell into each of those jurisdictions: you choose where you will accept orders
from, and as a consequence of that choice you choose which tax laws you will
deal with. Just like with a brick and mortar business, where you choose where
you open outlets, and as a consequence of that choice you choose which tax
laws you will deal with.

And each of those jurisdictions is required to provide free-of-charge software
to calculate tax rates _and_ hold retailers harmless for any errors due to the
software.

------
michaelmartin
Absolutely agreed here, this is just going to give an edge to companies
outside the US.

Worse still, it's going to hit small businesses worse because they will simply
have no choice but to pay it. The mega corps have their accounting down to an
art, they'll figure out a way past it given how many gray areas are inevitable
in a completely new form of tax like this.

~~~
dragonwriter
> The mega corps have their accounting down to an art, they'll figure out a
> way past it given how many gray areas are inevitable in a completely new
> form of tax like this.

Its not a new form of tax. Its permission for states to opt-in to a more
efficient _collection method_ for existing sales and use taxes if they also
agree to certain streamlining requirements for those taxes _and_ certain
support mechanisms for the retailers that would be required to collect and
remit the taxes.

------
jedmeyers
Just wait for the "foreign transaction fee" on the credit cards to become
federally mandated 15% instead of 3%. Then you'll see.

~~~
StuntPope
That's where Bitcoin comes in :)

~~~
betterunix
That's where federal regulations on Bitcoin comes in. How would you like to
live in a world where Bitcoin is a black market product?

~~~
msvan
Where I live, kids under 15 have to wear a helmet while biking. But I never
see any kids wearing helmets. Because laws that cannot be enforced will be
ignored freely. Piracy is supposedly illegal, but look at the attitudes
towards it: it's not considered a crime because it's impossible to enforce.

Perhaps bitcoins while be regulated, but will it not get green-stamped by the
general public just like piracy?

~~~
betterunix
Let's put it this way: if it is a crime to exchange USD for Bitcoin, where are
you going to get your Bitcoin money? Bitcoin would die overnight if exchanges
went away, and most people are not going to send an envelope full of cash to
some shady person on the Internet.

~~~
L4mppu
People would exchange from USD to GBP or EUR an dthen to BTC. U see no problem
there.

------
tokenadult
The legislation now before Congress simply allows states to collect sales
taxes (if the states have sales taxes) on transactions to residents of their
states by online retailers. (There was a special act of Congress that exempted
online retailers that don't have "nexus" in a particular state from such
taxes.) The immediate effect of this legislation, in my opinion, is that
Amazon will open a distribution center in my metropolitan area, located in a
state with sales tax, and offer same-day delivery for Prime customers. And I
will probably take up Amazon on that offer rather than shop in my locally
owned retail chains such as Target (walking distance from my home) and BestBuy
(which I loathe shopping at, and hardly ever visit). The United States
Senators from my state support allowing states to impose sales taxes on online
retail transactions, because Target and BestBuy (and some other large
retailers) employ a lot of their constituents, and because new tax revenue for
Minnesota will be spent by a governor and legislature who belong to the same
political party they do. But I will shop at Amazon if this happens. The new
law is not going to hurt my favorite online retailer at all.

------
Falkon1313
A few years ago, there was a big case where Massachusetts tried to force (non-
internet) retailers in New Hampshire to collect Massachusetts state taxes from
people who purchased things in New Hampshire that might in the future be used
in Massachusetts. The case got thrown out by the state supreme court because
to enforce it would require Massachusetts to force New Hampshire businesses to
violate their customers' privacy about where products would be used. New
Hampshire in turn passed a law prohibiting retailers from sharing private
customer information with Massachusetts auditors.

Trying to make the citizens of one state liable for enforcing the laws of
another seems ridiculous by itself. Making them enforce the thousands of
arbitrary, convoluted, constantly changing laws of 49 other states and all of
their localities is way beyond reasonable.

At least there appears to be a clause that states will have to simplify their
tax rules and provide free software to manage it. Although the idea of
integrating an e-commerce system with 50 separate bureaucratically-designed
systems doesn't really seem that appealing either... If the states also had to
pay for every integration and the maintenance of all e-commerce software, then
it would be a little more reasonable.

~~~
tss20147
24 states have already certified 6 sales tax service providers. It is expected
that most states will certify these same providers. The providers have already
integrated their service/software with a significant number of the major
e-commerce platforms. After all the integration drives business to them.
Depending on the service provider and the features used there may or may not
be a fee for the retailer.

------
davidw
This tax could make Oregonian consumers pretty popular: nothing to collect, no
tax, no hassle.

~~~
JoshTriplett
On the flip side, it'll remove a major reason to start a business in Oregon or
another state without a sales tax.

~~~
wcfields
Recent transplant to California, and I now have to go back to Oregon whenever
I make a major purchase. A weekend trip to see friends, have an Amazon order
shipped to them.

~~~
danielweber
You still owe use taxes on that.

------
Svip
I am slightly bemused by the fact that the US - which in Europe is often seen
as very lax on taxes - is doing this and it is not even being considered in
Europe. That might change, sure, but Europeans tend to like taxing things. And
if this haven't even made a consideration among European lawmakers, just how
far from the pack have the US lawmakers gone?

~~~
tss20147
The author and you are confused. There is no internet specific tax being
discussed in the US. The "Internet tax" bill just allows states to require
companies to collect state sales tax when they sell an item to someone in the
state. This is the same tax which is collected by brick and mortar stores
within the state. Currently if I buy items online each year when filing my
state taxes by law I must declare the value of my online purchases and pay the
sales tax on them. As you can guess many people don't declare the purchases as
required. The "Internet tax" bill is really a bill to change allowed tax
collection methods to ensure that all currently applicable taxes are
collected.

~~~
CanSpice
So as a hypothetical business owner in Washington who sells things online, I
have to keep track of the tax laws of the other 49 states, and remit 50 checks
quarterly (or maybe annually)?

~~~
dragonwriter
> So as a hypothetical business owner in Washington who sells things online, I
> have to keep track of the tax laws of the other 49 states, and remit 50
> checks quarterly (or maybe annually)?

Well, you have to either keep track of those laws for the states you choose to
sell into, or use the free software provided by each state that has opted into
the arrangement (the MFA provides an opt-in regime for states, with conditions
including the provision of free software, with retailers not liable for any
failure to collect and/or remit tax that is due to errors in the software.)
But, yeah, you have to pay each taxing "state" (which will probably be less
than 50 initially, but more than 50 in the limit case, since "states" under
the MFA include the the 50 states, DC, plus other US territories and
possessions.)

Or, instead of using the State-provided software and doing it yourself, you
can pay a "certified software provider" to do it, and be immunized against
liability for any errors that are the fault of that provider.

------
nullc
Will be pretty funny when we get a matching duty for their services thats
twice as much as typical salestax. :)

------
tmuir
Essentially, the article is saying that if you could save money by buying a
physical product from a foreign country, domestic businesses would suffer.

Those conditions exist today with the ability to buy things from China, and
all of the accompanying downsides will apply to buying something from Europe.
It takes weeks instead of days to ship overseas at acceptable rates. Who do
you call to complain/return/get service? Do they even speak English? Does this
product meet safety standards? Do I even have legal standing to sue the
company if I am defrauded/injured?

All of these go away buying domestically, and are not a fair trade off for a
marginally lower price.

------
coldtea
> _What lawmakers fail to understand is that taxation specific to the
> internet, ostensibly to boost revenues into government coffers, in practice
> will probably diminish them as US businesses lose competitiveness against
> foreign companies._

And what you fail to understand is that if everything is sacrificed in the
name of "competitiveness", then every country will be in a race for the
bottom.

It already happens, with outsourcing, cheap foreign labour, tax heavens etc. A
successful US company used to benefit American society at large (beyond merely
paying some wages) -- and this is what made the US rich with a large middle
class etc.

Now (with outsourcing, factories in China, money kept in foreign accounts that
never make it back to the US, tax havens enabling the company to pay almost
nothing in taxes etc) a company can be American in name, but of no more
benefit to the US as a country than Toyota or Samsung.

And no, places that are strongholds of industry and innovation don't help much
either. A 100 billion new innovative product out of Silicon Valley can be as
lost a boon to the country as any innovation coming from Tokyo or Europe.

Hence, shrinking middle class, hence budget and trade deficits, hence trouble.

Of course, for those owing or running companies and benefiting from the whole
thing, business hasn't been better. But those benefiting are increasingly
fewer (and the few tend to benefit all the more, hence huge imbalances in
inequality).

I'm not saying that amazingly successful companies cannot come out of this
situation. I'm saying that this success trickles down to the overall
country/society, far less than what it did in the past. Coming to a point
where it will be possible to be the host of the worlds greatest companies AND
having a population living like in a third world country.

The only reason everything has not collapsed already is because there are
other advantages beyond "cheap" that keep companies throwing a bone to the US.
The infrastructure, the engineering savvy, and of course the inherited middle
class and large market, from better times. But those things are rooted in the
past and are transient.

> _To our American friends, easyDNS is a foreign company, so don't let us stop
> you._

And how about you aren't let to serve customers in the US unless you pay taxes
too?

How would you feel about losing the rich US market then?

And how about people in Europe and other affluent societies conspired so that
you cannot sell your crap without paying proper taxes to someone?

(I'm not even arguing in favor of the internet tax. Just against the arguments
easyDNS used here against it. Heck, I'm not even American. I just know that
those same issues affect my country too).

~~~
dclowd9901
The world, sir, will get along just fine as the US slinks into its sunset
years. As an American citizen, I can assure you the writing is, and has been,
on the wall.

~~~
wolfpackk
As an American citizen, I can assure you this guy is talking out of his ass,
and America will continue to be a leader in many cutting edge fields for years
to come. American economic prowess may decrease relative to the rest of the
world as they finally catch up, but "the writing is on the wall" is
sensationalist bullshit. I will never understand the correlation between
technophiles and Libertarian pseudo-economic bullshit; 0 empirical evidence to
back it up, yet the same stupid causal chain of events is brought up all the
time.

~~~
dclowd9901
> American economic prowess may decrease relative to the rest of the world

Not just decrease but get overtaken by.

\- Our public K-12 education is a pile of shit and our colleges are riding on
a public dollars bubble that makes the housing crash look like spilled water.
Any attempt to deal with the problem ignites fury over teachers' rights,
causing policy makers to run shitting their pants to the nearest podium to
apologize.

\- At every possible juncture, policy decision is leaning on pervading status
quo: patents, bullshit municipal license bureaucracies, congressional players
pandering to businesses, not constituents

\- Health is a disaster, and even with Obamacare, it's looking like it got
neutered just enough to do precisely shit for the long term. People go
bankrupt to get care, if they can even get it.

\- Culturally, a sweeping wave of anti-intellectualism has taken hold and
bolsters everything above. We can't get anyone to care about any of these
issues if they're fucking retarded.

\- All the while, the smartest, very smartest people in our country are
jacking each other off in silicon valley inventing the next cat-picture
collection app, while the economic, technological and social divides keep
growing. They're more interested in becoming their idoled psychopathic CEOs
than actually fucking solving real problems. They're living in an absolute
bubble, unaware of what 60% of the country cares about or actually needs.

How are we supposed to be the leader of anything if we're in a constant state
of regression?

~~~
will1000
I agree that America is doing many things wrong, and has many challenges
facing it now and likely well into the future. However, I would also like to
remind you that America is as a nation, _237 years old_. It is a country that
was founded by rebels and is often in some sort of crisis and or revolution at
any given time. Despite(because of?) this, great things and great people
consistently grow from here, and I have no doubt that will continue well into
the future.

I am surprised when I hear people talk of our current issues as if they will
be what does us in. Think of the big picture here, do you really think America
is going to get "overtaken" in the 21st century when in many ways we are
leading it? And I do agree we are behind in some ways as well, but we don't
have to be number 1 at everything to be successful, or at the least survive
and progress as a nation.

~~~
dclowd9901
These aren't "issues of the day." These are systemic and fundamental problems
that lead to downfalls of nations.

During our greatest advancements, we maintained a well oiled machine of an
educated constituency, a public-private partnership and a middle class
bursting at the seams with potential and opportunity.

Those things have all either been stripped, scammed or atrophied out of the
public, and what we're left with is a paralyzed public sector and a private
sector that's racing to the bottom of the moral barrel. I just don't see any
hope in anything short of some sort of awakening. Call me pessimistic and
dismiss me, or at least recognize that something has to change.

~~~
wolfpackk
People in Silicon Valley are making cat picture apps, haha right. You fucking
idiot, gtfo people like you are shitting up the forums. America is more
intelligent and wealthy than any nation in the history of the universe, stop
crying on the internet and go be a part of it.

------
belorn
> What will probably happen is that affected businesses will have to "eat" the
> tax and drive their margins down...

Or e-commers will do what they always have done when legislation change. They
"move" their cloudy servers to somewhere where said laws do not exist.

We saw this exact thing each time EU passed some new data privacy law. People
stayed in their country, but the servers suddenly poped up in NA, or Ireland,
or some small Caribbean island that no one has heard of. Trying to enforce
taxes or privacy laws on e-businesses is like trying to shut down the Pirate
Bay. It simply moves on to a new IP under the same domain name.

------
nhashem
Sorry, but this is asinine.

Easy DNS charges $19.95 CAD/yr for its basic package of DNS services for a
domain. Amazon's Route 53 charges $0.50 per month, or $6.00 USD/yr. Given the
OP claim to be "traditionally anti-big government, pro-free market, pro-
capitalist whack jobs," they are offering a service 3x more expensive than a
comparable service US company. Maybe EasyDNS has some extra goodies that Route
53 doesn't to justify the higher price. Either way, _that_ is what drives Mr.
Smith's invisible hand, and _acting like US states enforcing their 6% or 8% or
even 8.75% sales tax is some sort of game changer is absurd._

The OP seems to woefully misunderstand that this is _not a new tax._ This
requires any internet business with over $1 million in sales -- which I'm
guessing doesn't apply to a _lot_ of startups whose founders/employees read
HN, btw, mine included -- to collect any applicable state/local sales tax at
the point of sale, just like pretty much every local business. And if these
businesses are getting squeezed by internet retailers, I'm guessing it has
nothing to do with sales tax. Recently I needed a DisplayPort/DVI adapter, and
impatiently went to Best Buy, where the only one I could buy was $30. Then I
saw this one on Amazon for $4.95 on Amazon --
<http://www.amazon.com/gp/product/B003BHHIA4> \-- promptly ordered it, and
returned the Best Buy one, even though Amazon sales tax meant I actually paid
$5.45. Best Buy is getting destroyed because retailers can sell similar
products at a 84% discount, _and that would still be true if it was only a 78%
discount._

So, to the OP and all the other people I've seen on HN lamenting that this
bill is akin to exhuming Adam Smith's corpse and urinating on it: can we
please stop acting like this is the end of the world? Making sweeping states
predicting economic outcomes without practical considerations (e.g. many
internet retailers have a pricing advantage that dwarfs sales tax) and human
responses (an effective 6-10% increase on purchases -- _'effective' because
this is a tax they should have been paying anyway_ \-- is not really
accomplishing much. There are times to get infuriated about the government
fucking up the free markets and disincentivizing capitalist innovation and
production, but I don't think this is one of them.

------
rayiner
I must have missed the memo. Why are we ranting and raving about collecting
sales tax on internet purchases? Is there some other internet tax I'm not
aware of?

~~~
dangrossman
Yes, the "internet sales tax bill" (marketplace fairness act) passed the
Senate this week. It has White House support, so only needs to pass the House
to become law.

A summary: [http://www.dangrossman.info/2013/04/24/what-startups-need-
to...](http://www.dangrossman.info/2013/04/24/what-startups-need-to-know-
about-the-internet-sales-tax-bill/)

~~~
rayiner
What's bad about it?

~~~
dangrossman
I don't have time to read 50 states' tax codes, file 50 tax returns and
potentially be audited 50 times a year. What small business does?

~~~
tptacek
Most of them. As soon as you have any real cash flow, you engage accountants.

~~~
dangrossman
My accountant would not be able to handle a XX-fold increase in the number of
tax codes, forms and filings he has to handle per-client. We're going to have
to train more accountants.

~~~
tptacek
I don't agree. Maybe you could ask your accountant? I guess at some point I
could ask ours too.

~~~
dangrossman
I have to make an appointment to see my accountant at least 1-2 months in
advance if it's anywhere near tax time (late January-May). He's definitely no
time to take on more forms per client, let alone advise me properly which
states will tax which products at what rates.

I run the online store for my father's retail shop, with several hundred SKUs.
We sell fancy health water bottles for example -- some states this is not
taxed, some it is, some it is depending on bottle size and whether it meets
their definition of water or some other kind of beverage. _Someone_ will have
to reconcile every SKU against every state's sales tax classification changes
every 90 days. That's not something any accountant does for small businesses
operating in a single state right now.

~~~
tptacek
Maybe get a better accountant? I'm being serious. I definitely don't need to
ask a month in advance to talk to my person accountant or our business's.

~~~
dangrossman
We'll obviously need one (where today this accountant meets all our needs, and
has been a family friend for decades), but a small business accountant that
can do what's going to be required doesn't exist yet. Only national chains
have had to worry about such things.

~~~
tptacek
Again, and respectfully, I don't think handling sales tax filings for a small
business is a huge hurdle compared to some of the craziness that even small
business accountants are routinely called on to do.

Your point upthread was "no small business person can handle filings to 50
states". I'll stipulate that! My response is just, people with real businesses
usually don't (and shouldn't) DIY their taxes anyways.

~~~
uit
They dont? And shouldnt? Why not? The point someone here is trying to make is
that what was once simple is potentially going to become inordinately
difficult. Not impossible but very difficult.

And by who's determination is my business "not real" if I do my own taxes???
At least I do my taxes more accurately than Geithner does or did AND HE got to
sign our dollar bills! Was his business "not real"?

Once again, thanks to GovCo, life is getting worse, harder not easier, asinine
not smart. There is absolutely NO THOUGHT WHATSOEVER put into anything coming
from DC lately. None.

~~~
rayiner
What exactly is your complaint here? Are you opposed to sales taxes on
principle? If not, what's your complaint? Properly accounting for sales and
business taxes, as well as following other laws, in a jurisdiction in which
you do business is a basic cost of doing business. The U.S. just happens to be
a country of 50 sovereign jurisdictions, each with autonomy in how they
structure their sales and business taxes. Does this make accounting for taxes
complicated? Sure. It makes lots of things complicated. But we did it on
purpose. Why should Congress insulate you from that reality?

The internet certainly makes it easier to say take orders from people in many
different jurisdictions at once, but why should you get to avoid the other
business realities of operating in multiple jurisdictions just because you're
an internet business? You might see everyone as just an IP address, but in the
real world, groups of those IP addresses are parts of sovereign entities
called state and national governments, and each of those groups are governed
by different laws. Just being an internet business shouldn't insulate you from
the reality that exists once you break through the IP address abstraction.

------
grecy
The US government will just mandate that any online business doing business
with US citizens has to collect that tax on behalf of the IRS.

Quarterly deposits will be acceptable.

~~~
dangrossman
How would the US government mandate a non-US business do anything? They can't
prohibit US citizens from buying from these companies without violating their
own free-trade agreements. That'd be a bad idea, since 41% of the country's
exports go to countries we've signed those treaties with.

~~~
dave5104
I imagine the US government could just add said non-US business to an embargo
list of some sort. Prevent them from doing any business whatsoever with US
citizens.

------
dbrannan
Sounds like taxation without representation to me.

~~~
dvanduzer
Are you saying that Network Solutions and GoDaddy should have seats in
Congress?

~~~
dangrossman
I think he's saying that individuals that sell online shouldn't be taxed by
state legislators they didn't elect. Congress won't be setting the internet
sales tax rates, nor administering the tax, nor conducting its audits -- the
50 individual states will be imposing their individual rules.

~~~
fryguy
It's the person that's paying for the product being taxed, and the merchant is
merely collecting that tax. At least, that would be my interpretation.

~~~
dangrossman
If a foreign state I've never stepped foot in can set laws I have to obey,
force me to remit money to them, and audit my accounting under penalty of
imprisonment, it doesn't really matter who's doing the paying. Today, only
people within the state can be forced to obey and be audited by that state.
This bill gives the power for a state to create and enforce arbitrary laws on
non-citizens. It's at least a sufficiently different situation to debate.

Boy would I prefer a single federal sales tax with the fed doing the
distribution to the individual states.

~~~
smsm42
That's what happens when you do federalism only when it's convenient. Right
now since "interstate commerce" is extended to cover any activity that may be
imagined to be related to commerce (including growing plants in your own
garned for your own benefit) it means federal government can force commercial
entities to do anything. Including complying with foreign laws (including non-
existant foreign laws:
[http://www.threefelonies.com/Youtoo/tabid/86/Default.aspx#La...](http://www.threefelonies.com/Youtoo/tabid/86/Default.aspx#Lacey)).

Single federal sales tax with distribution would result in either grotesquely
complicated calculation system or some states sponsoring other states for
political reasons. And, of course, all local governments blaming federal
governments for the lack of funds and their inability to do anything.

------
aashaykumar92
Do you think the US government is unaware of this? I, for one, do not. I bet
they will do SOMETHING (not sure what, but @jedmeyers gives a possibility) to
ensure that US online retailers will not be defeated by foreign retailers that
easily.

------
mikeburrelljr
Is the Internet tax on goods only? (This article speaks as if it is on
services as well.)

~~~
dangrossman
The bill allows states to force out-of-state retailers to collect their sales
tax, rather than requiring the end-customers report and pay them with a use
tax return. Each state will still set its own classes of taxable goods, and
services are already taxed in many states.

