Have you heard that the National Retail Federation wants to tax on-line stores that sell to folks out of state? Let’s consider this issue.
The pros? Well, some sort of government will receive more tax revenue. Shoppers might be more likely to cancel an intended purchase once the sales tax is added, making them more likely to review all their purchases and tighten their belts a bit more, adding to their savings. On-line retailers might even lower their prices a bit, to make up for the addition of a sales tax. Wait…that’s not exactly a pro – it’s more of an even-Stephen.
The cons? Purchases from on-line stores will cost more. Less people might make on-line purchases.
Did you see a pro that local retailers will make more money because less people will buy on-line items? No, you’re not crazy. I don’t believe it’s actually going to happen if this law comes into effect.
But there is another side to this issue, and that is whether or not the federal government has the right to make a decision about this, like the U.S. Supreme Court already did (http://blogs.wsj.com/washwire/2012/05/25/retailers-push-gop-on-online-sales-tax/?mod=WSJBlog).
I’m not a hater of the federal government. I’m not sure where I stand on the so-called “flat tax” – mostly because I haven’t heard enough from supporters to make up my mind. But most people in favor of the flat, or fair, tax, believe in less federal government and more states’ rights, and I definitely agree on a case-by-case basis. This is one of those cases. Either each state should decide to add sales tax to on-line sites so that when retailers sell out of state, that buyer is additionally taxed, or the voters of each individual state get to decide. What do you think?