Wake Up and Smell the Coffers: Internet Taxation Is the Wave of the Future

Article excerpt

We need to pull our heads out of the sand and come up with a way to make Internet taxation work for us.

You just filed your 1998 federal and state income tax forms and may be feeling proud about contributing so much to the public good. You may be looking forward with excitement to the creativity and effectiveness with which various levels of the government will put your hard-earned dollars to work.

Or you may be like me. You may not feel pride, but resentment. You may resent being forced to fill out all those forms and pay up, seeing so much of what's yours frittered away by power-hungry politicians and their burgeoning bureaucracies. You may resent that if you don't pay up, the government will send citizens with guns to your house to collect.

So it's with considerable trepidation that I choose to raise the subject of Internet taxation. And I'll dare to argue for more of it.

Don't bother sending me angry e-mail pointing out that our representatives in Washington just passed the Internet Tax Freedom Act (freedom.house. gov/vote/voted.asp). Indeed, the act forbids access, bit, multiple, and discriminatory taxes on the Internet. So, you might say, leave well enough alone.

But the act is only a three-year moratorium. It commands that a commission be formed to study Internet taxation for two years and then make policy recommendations. [The commission holds its first meeting this week--Ed.]

Now, I hope we can do better on Internet taxation than we have on Internet pornography. We put our heads in the sand on pornography until the first Communications Decency Act was passed by a clueless Congress. Then we let professional civil libertarians file lawsuits to try to clean up the mess. The mess, of course, persists to this day, along with the porn and more lawsuits. Nothing like a lawsuit to clear the air, eh?

The time, why not try being proactive about Internet taxation? Face it, the Internet won't be some alternative tax-free utopia. Commerce on the Internet is already in the tens of billions and booming. Internet commerce will be taxed. Has to be. Get over it.

So what technologies, standards, and systems are needed to support the variety of taxes likely to be levied? …