Illinois Legislators Chasing a Tax Money Mirage

In their race to raise taxes for a cash-strapped state government, Illinois legislators are pursuing a mirage that other states have already discovered was a dry and dusty disappointment.   MirageYesterday, the General Assembly approved a version of the “Amazon Tax” that would actually reduce tax revenue while harming Illinoisans who make a living through online advertising.

As in other states, this tax scheme will once again backfire to the detriment of Illinois’ entrepreneurs and state tax coffers.  HB 3659 is supposed to force an out-of-state retailer to collect Illinois sales tax if they use in-state ‘affiliates’ – Illinois websites that earn revenue by showing ads for the out-of-state retailer. Read more

Privacy Trumps Taxes—Victory for Consumers in North Carolina…But What About Colorado’s Bad Law?

A federal judge sided with privacy over taxes yesterday, signaling a victory for consumers in North Carolina. Now we’re waiting to see if this also means victory for consumers and online companies that sell into Colorado.

A U.S. District Court in Seattle blocked North Carolina’s Department of Revenue from compelling Amazon to reveal the names and addresses of its customers so that North Carolina could go after them for not paying use taxes on purchases where they did not pay sales tax. Read more

Foxes in the Small Business Henhouse

The negative impact that a Streamlined Sales Tax (SST) would have on small businesses was once again the hot topic at this week’s meeting of the SST Governing Board. foxes-in-the-henhouse

 

As readers of this blog know, NetChoice has consistently sounded the warning bell about the huge costs and compliance burdens small online retailers would face if Congress required them to collect sales tax for all states. Thankfully, some members of Congress understand this. But most of the legislators and tax officials on the SST Governing Board do not. Read more

It’s September – Back to Work on AWFUL Internet Laws

iAwful After a quiet August recess in Washington, DC, it’s time to refocus our efforts on public policies that impact online commerce. And today we consider not the good, and not merely the bad, but the awful – iAWFUL.

 

The Internet Advocates’ Watchlist for Ugly Laws (iAWFUL) tracks the ten instances of state and federal legislation that pose the greatest threat to the Internet and e-commerce. Our efforts so far this year have helped to remove two of the worst offenders from the February 2010 iAWFUL list, including a federal bill giving the Federal Trade Commission more powers to make new rules for online activity without Congressional guidance, and a Maine law restricting online marketing to teenagers. Read more

Congressman Hodes Hits a Home Run for Small Business

Ruth HomerCongressman Paul Hodes stepped up to the plate for small online retailers, and took a swing at a proposed law that would force new tax collection burdens on even the smallest of businesses who use catalogs or websites to serve their customers.

 

Hodes’ resolution is titled “Supporting the Preservation of Internet Entrepreneurs and Small Businesses,” and its main provision is:

 

Congress should not impose any new burdensome or unfair tax collecting requirements on small on-line businesses, which would ultimately hurt the economy and consumers in the United States. Read more

When it comes to Internet taxes, where you sit determines where you stand

There’s a wise adage that goes “Where you sit determines where you stand.”   Keep that in mind when you hear someone advocate a new sales tax collection mandate on small out-of-state retailers.

 

In a post at BNET last week, Chris Dannen described how big retailers are supporting the so-called “streamlined sales tax”:

 

“Brick-and-mortar retailers — many of whom have operations online — are some of the most vocal proponents of the new online tax laws. The members of the pro-tax lobby, which includes Best Buy, WalMart ,Target and others, already collect sales tax online, regardless of the buyer’s state, and see Web-only retailers as having an unfair advantage. How to Tax E-Commerce without Killing Entrepreneurship (and eBay)” Read more

On Tax Day, a Taxing Year (Already) on Internet Commerce

Internet tax man It’s April 15, so hopefully nobody’s waiting in long lines at the post office (though we think you should be using the Internet to file electronically). Unfortunately, it’s only April but already it has been a taxing year for online commerce.

 

We’ve seen six tax-related categories of bills that have been introduced in state legislatures this year: (1) Privacy-invading purchase reporting laws; (2) Bounty hunter bills; (3) affiliate advertising as a nexus for requiring sales tax collection; (4) imposing hotel taxes on online travel companies; (5) expanding Internet sales taxes based on inadequate simplification; and (6) new taxes on digital downloads.   Read more

Rocky Mountain Low: Colorado’s New “Track & Tax” Law Invades Consumer Privacy

 

Colorado_rocky_mtns He climbed cathedral mountains, he saw silver clouds below
He saw everything as far as you can see
And they say that he got crazy once and he tried to touch the sun
And he lost a friend but kept his memory

-John Denver, Rocky Mountain High

We know that states are increasingly looking to tax anything and everything, including on the Internet. As Declan McCullagh reported earlier this week, Colorado and “fifteen other states have considered or are considering enacting laws targeting Amazon and other e-commerce companies that typically do not charge sales tax for shipments sent outside their home state.” These nexus taxes are #2 on the NetChoice iAWFUL list of bad legislation. Read more

Advertising Nexus Tax Harms In-State Organizations the Most

There’s a lot of misinformation surrounding the so-called “Amazon tax.” Advocates call for an advertising nexus tax because they think a sales tax collection obligation for out-of-state online companies is an equalizer for brick-and-mortar “main street” retailers. Even if that were true, advertising as a nexus for sales tax obligations is not the way to achieve increased revenues (we think it harms the local economy). A recent example of the confusion surrounding this complex issue is today’s editorial supporting new tax legislation in the Lynchburg News & Advance.

 

The editorial supports SB 660, a legislative proposal to create the “Amazon tax” in Virginia. However, the editorial gets it wrong on a number of accounts, and fails to consider how this legislation would hurt Virginia’s economy. Read more

The Worst Internet Laws in America, Take Two

iawful LogoBack in June, we introduced iAWFUL (the Internet Advocates’ Watchlist for Ugly Laws) as part of a broader effort to push back against America’s worst Internet legislation. Two months have passed, and while many of the bills in the top 10 have changed, they remain every bit as AWFUL.

 

Earlier today NetChoice unveiled the first major update of iAWFUL, which lists the 10 worst Internet bills/laws in America. The updated listincludes five new items, with new laws in the top 2 slots.

 

But before I get to the truly AWFUL measures in the new list, it’s worth mentioning a few that fell off the list, in large part thanks to the pressure that Internet advocates exerted through iAWFUL:

 

#2 on the June iAWFULlist was a California bill that would have forced unworkable technical restrictions on the posting of photos to social networking pages. The bill’s sponsor responded by working with Internet advocates to fix problems with the measure.

#3 on the June iAWFUL list was a bill in Connecticut that would have required sales tax collection by out-of-state businesses that pay commissions to in-state affiliates. The Governor heard our concerns about the impact on in-state publishers and school charities, and has thus far kept this measure off the table in budget negotiations.

#5 on the June iAWFUL list was a Connecticut bill to let police conduct searches of homes where goods were being stored by online dealers – without having to obtain a search warrant. Thanks to iAWFUL publicity, this bill stalled in the House. Read more