The Governor is considering a new sales tax on downloaded music and videos as part of a package of tax increases to help fill a large projected budget deficit, according to the Chicago Sun Times. The download tax proposal – expected to raise between $5 and $10 million from on-line purchasers – is one of a dozen options that could increase taxes by between $360 million and $570 million.
Consumers are increasingly enjoying the convenience, selection, and environmental benefits of purchasing digital music, video, and other digital products on-line. The proposed new tax would not only discourage on-line purchases, but it would also drive Illinois consumers to purchase from out of state sellers. This is because, under the proposal, Illinois businesses would be required to collect the tax while out-of-state businesses would not.
With Illinois and other states desperate for revenue, it is critical that Illinois consumers take action now to prevent damaging new taxes on the digital economy. Click here to let Governor Quinn know that you do not support a new tax on downloaded music and videos.
Oklahoma’s proposed budget for 2011 includes a new tax on digital products. The proposed tax, which applies to certain digital products, will harm in-state businesses by requiring them to collect sales tax on those specified products, while out-of-state businesses selling the same products would not be subject to the sales tax collection. This tax would also drastically reduce the progress Oklahoma has made towards attracting new business to their state with legislation such as the Oklahoma Site Ready Program. Despite the discriminatory nature of such a tax, the Governor has included it in his proposed budget. You can do something about this! Click here to let the governor know you don’t support this new tax on digital goods in Oklahoma!
The Federal Communications Commission released its National Broadband Plan on March 16, 2010, including a recommendation that the federal government establish rules for state taxation of digital goods and services. While the FCC’s Plan is focused on increasing access to broadband service, Recommendation 4.20 of the Plan calls for the federal government to establish “a national framework for digital goods and services taxation.” The Plan recognizes that “the current patchwork of state and local laws and regulations relating to taxation of digital goods and services (such as ringtones, digital music, etc.) may hinder new investment and business models.” It is hoped that a national framework would solve some of complexity and problems being created as states attempt to impose onerous taxes on digital goods and services. Specifically, the framework must prevent multiple and discriminatory taxation of digital commerce and employ a uniform sourcing regime.
Virginia Democrat Rick Boucher and Texas Republican Lamar Smith have introduced the Digital Goods and Services Tax Fairness Act of 2010 which would make it extremely difficult for states to levy taxes on goods and services purchased over the Web. The Boucher-Smith bill would impede the taxing of digital goods because it would force state legislatures to hold up or down votes every time a state agency attempted to tax anything sold via the Internet.
Read More at NetworkWorld
South Carolina's Tax Realignment Commission is recommending that the state for the first time charge sales taxes on digital purchases from online stores including iTunes and Amazon.com. The commission's proposal is the latest in a series of changes lawmakers have made to the system of tax collections, and represent a reversal of recent legislative philosophies. However, no changes will happen unless the Legislature approves them.
Read more at The Post and Courier
Currently, some 23 states and the District of Columbia levy sales taxes in one form or another on e-books, music, apps, ringtones, and other digital downloads. However, a new proposal in the U.S. Congress titled the Digital Goods and Services Tax Fairness Act, is designed to ensure that these"iTaxes" which have popped up all over the country in the last three years do not single out the digital marketplace with excessive or discriminatory taxes. The bill, sponsored by Congressmen Rick Boucher (D-VA) and Lamar Smith (R-TX.), is part of a broader effort by technology firms and telecommunications providers to push back against what they view as tax agencies that are unreasonably singling out electronic purchases with unfair, expensive, and confusing rules.
Read more at CNET news
Do you think it’s fair to be taxed when you buy music, games, applications, or other downloaded products and services on the Internet? States are facing real budget crises, but so are consumers. Today, the threat of download taxes has never been greater. SIGN THE PETITION TODAY and help keep Internet commerce free from taxation.