1. These are on-line businesses we’re talking about here, not some mom-and-pop corner store. They had to overcome far more difficult problems than tax computation just to get the store on-line in the first place. While it is a legitimate problem with the proposal, it is not by itself sufficient reason to oppose the plan. Frankly, I’d rather do it for all mail-order business, because once you set aside the logistical problems, it seems more equitable. (As a buyer, I’d rather have my tax dollars support my locality rather than the one in which the business is located.)

One easy solution to the problem is to have the states themselves provide the mechanism by which sales tax is calculated. Computers are fast enough and interconnected enough that this really isn’t that complicated. Provide a city, state, and ZIP or a ZIP+4, and the tax rate is provided for you. It wouldn’t be nearly as complicated as you seem to think, and again, most retailers have far more complicated pricing problems to face.

2. While that seems intuitive, I’ve never seen any evidence that this holds true. As with income tax increases and cuts, the effect seen is temporary. Reagan raised taxes several times and spending never went down the shitter in response. Spending might drop for a short period after the increase, but would rebound to whatever level it would have been at prior to the increase. However, what would happen is that one of the incentives (tax avoidance) for mail-order and on-line shopping would be taken away; but I don’t think that would trump the convenience factor. On-line businesses wouldn’t go out of business overnight or anything like that.

3. If you’re referring to starting quarter-trillion dollar wars, I’m inclined to agree. But likely not. As mentioned above, most people actually like most government programs and don’t want them to go away. And survey after survey has shown that given a choice between lower taxes with fewer services and higher taxes with more services, most will choose the latter. That’s why the Republicans never actually cut spending when they cut taxes (except from programs Republicans generally hate), and why they perpetuate the fiction that you can have your cake (lower taxes) and eat it (government services) too.

1) By charging sales tax depending on the location of the buyer rather than the seller, it creates a huge burden for the businesses that are supposed to compute and collect this tax. I’ve lived in places where a brick and mortar store had to collect sales tax for three different governments – state, county, and city. Tax rates (and who they owed taxes to) were often different on one side of the street than the other. Tax rates also differed depending on what you were selling; groceries were a lower rate, most things a higher rate, and restaurant and motel charges an even higher rate. So the store’s computers would have to pick 3 out of 9 tax rates, depending on what was sold, and maintain 3 different accounts. This wasn’t an impossible burden, because the store knew where it was located and did not move. Compared to the cockamamie zoning and licensing laws, this might even be considered easy…

However, when you try to tax internet or mail order sales by the location of the customer, now you’ve got a retailer in another state trying to figure out all the local sales tax laws and even which side of the street you live on. Unless this compact mandates a drastic simplification, this will put an impossible load on the sellers.

2. Higher taxes cause lower sales. If sales are taxed according to the location of the business, then the consequences of high taxes (less business, unemployment, and a smaller tax base) falls upon the government that imposed the taxes and the people who voted for it. If sales are taxed according to the location of the customer, then many of the consequences fall upon businesses and residents of other jurisdictions.

3. There’s another reason to prefer lower taxes: what government’s do with extra money…

Oh crap. Just realized I have to come up with another psuedonym for, uhm, junior 2.0.

That, of course, is a pipe dream.

Of course, you know as well as I do that this isn’t going to happen. Because the only way to make it work is to eliminate social security, medicare, or both, and the electorate simply won’t accept that. Made all the worse by the GOP’s supply-side fairy tale in which tax cuts don’t require matching spending cuts, which was bought into by an embarrassingly large cross-section of the American population (aka, Reagan and Bush voters).

They lost a customer but they didn’t lose $x in revenue. They never got it to begin with.

Money fairy? Isn’t that the federal government? I mean, they just print the stuff, right? No, I kid.

Well, let’s see, maybe by cutting spending elsewhere?

*gasp* No, really? Now if you’ll just explain which money fairy is going to pay for roads, schools, the military, and a quarter-trillion-dollar war, I’ll stop accusing you of cognitive dissonance.

And would you have preferred it if Fox had said that state and local governments will “collect $18 million fewer taxes” (rather than “lose $18 million”) because of internet sales? The term “lose” has more meanings than the accounting definition, you know. By your nitpicky definition, if I stop shopping at Target and instead switch to Wal-Mart, Target didn’t “lose” a customer.

Because they know that if internet sales leach an increasing amount of revenue away from traditional sales, those beureaucrats will either raise the tax on traditional sales, or raise other taxes elsewhere. Or maybe they just have a — what’s the phrase? — sense of fairness and wonder why retailer A should pay taxes but retailer B should be exempt from them just because they have a different distribution model.

Uncle:

Frankly, I’m a bit surprised you’re opposed to this (other than the optional part). I thought libertarians liked taxes on consumption…