Wall St. Journal – “The days of tax-free digital content are numbered”
But apps and other digital content like e-books and music are not really simply digital equivalents of books and CDs, says Steve DelBianco, executive director of NetChoice, a coalition of e-commerce firms like Yahoo, Facebook and AOL. Most downloads can’t be resold, gifted or traded, he says. Customers get a license for the digital files — but they don’t own them the way they own a book or CD. (Also see: Who inherits your iTunes library) States are grappling with this dilemma in different ways. New Jersey introduced a sales tax on e-books, music and even ringtones in 2006, but excluded video-on-demand. “States that want to tax digital movies are salivating at the thought of collecting those taxes from sellers that have no presence in their state,” he says.