California Can't Resist: Wants To Tax iTunes Downloads Again
from the keep-on-trying dept
There are some states that already include a sales tax on internet downloads for things like iTunes purchases (even if the rationale for the tax doesn't seem to exist beyond "the state needs money"). Every so often various other state politicians start itching to add an iTunes download tax. The latest is California. Some state politicians made a bunch of news back in April for proposing just such a plan, but the resulting publicity and anger from California residents made sure that proposal was quickly shot down. So what did the main sponsor of that proposal do? He waited less than two months and proposed a nearly identical tax on digital downloads. Of course, all this will really do is push more people to look at alternatives, legal or not, because of the greater expense associated with digital downloads (a product that should get cheaper over time, rather than more expensive).
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Filed Under: california, downloads, itunes, sales tax, taxes
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Taxes
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Re: Taxes
There are bad liberals and there are bad republicans we seem to have an abundance of both and shortage of good.
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Re: Taxes
In this case yes they're a Democrat - Assemblyman Charles Calderon (D-City of Industry).
Of course it is California...
I love your use of Liberal here too, because of course we all know the righthanded wingnuts like to use that word as a way of insulting a person.
Really good form there. Sheesh.
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Hidden agenda
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Re: Hidden agenda
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Re: Re: Hidden agenda
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I shouldn't say this on Techdirt
If you buy CD from a store do you pay sales tax?
If you buy software from a store do you pay sales tax?
Again if you answered yes to those questions:
Why shouldn't downloads get a sales tax?
Also as you can see by my subject line, I know this isn't going to be popular.
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Re: I shouldn't say this on Techdirt
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Re: Re: I shouldn't say this on Techdirt
Typically sales tax is collected on the sale of an item if the vendor has a physical presence in the state you live in.
We see this all the time with online sales already.
In the case of iTunes, it sortof makes sense but only if you are a California resident.
My state of Florida is not entitled to collect sales tax on an online transaction with a company in, say Ohio, which has no presence here in Florida.
This is also why many states have laws in place which are essentially "use taxes" whereby if you buy something out of state you are supposed to turn around and pay the state for the "lost" tax revenue. It doesn't really work except for vehicles, where they nail you at the time of registration in Florida if the vehicle is less than 6 mos old.
To others: Remember states believe they have the right to tax anything at any time. : )
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Re: I shouldn't say this on Techdirt
isn't sales tax related to a physical store? I think buying online is more like buying from out of state, or maybe different country.
does California law require you to pay sales tax on products you bought from Delaware?
something similar came up i believe when i think new York wanted to tax amazon.
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Re: Re: I shouldn't say this on Techdirt
unless merchant in question has physical presence in California.
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Re: Re: I shouldn't say this on Techdirt
Actually, yes. Of course, it's not a sales tax, but a SALES AND USE tax
Nobody does, of course, but the law is that if you purchase taxable goods from out of state, then you are supposed to pay the California SALES AND USE tax on those goods. You aren't being taxed on the purchase, you are being taxed on the use of the goods.
I seem to remember there's even a place on your state income tax return to note those taxable sales
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Re: Re: I shouldn't say this on Techdirt
I have a local Sales tax rate of 8.75% and they want to raise that (again) to fund the social engineers(read Liberals) visons of Nirvana for anyone getting into california
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Re: I shouldn't say this on Techdirt
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Re: Re: I shouldn't say this on Techdirt
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Re: I shouldn't say this on Techdirt
Moving on to the meat of your post, I'm now curious. I know whey I buy physical goods online I sometimes have to pay sales tax, and sometimes I don't.
For the ones where I don't, I don't know if they are just doing it wrong or are providing an unadvertised incentive for me to go to them rather than someone else.
For the ones where I do, I don't know if they're just milking me for more money, or actually just know what they are doing.
With tax being a percentage, I have no issue with having to pay sales tax on digital goods as well as physical goods. It'll (supposedly & hopefully) help pay for more services, better roads and schools and so on.
I live in Washington State. We have a sales tax around 8 cents on the dollar I think. It's been a while since I had to worry about it since I got a better job that's given me a nice buffer financially.
A song on iTunes is like what? A 1.30? I don't mind paying 1.39 instead due to sales tax. There's a lot of infrastructure that needs to be built and improved let alone maintained.
The question is, with this tax are they trying to double tax? If Cali already has sales tax, just make it apply to digital goods. Amend that tax that exists. This story (did not RTFA) sounds like they are adding a special tax just for it, possibly at different rates.
And it opens up to attempts to double tax...
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Re: I shouldn't say this on Techdirt
Your a moron. Do you have iTunes? You already pay sales tax if Apple has a store in your state/county, which accounts for most users, I imagine.
This is a Digital Download tax, ADDITIONAL to sales tax. I have to wonder if someone from Redmond bought off a politician to introduce this bill. They are pretty ruthless, and Robbie Bach, no. I do not want your product.
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Re: I shouldn't say this on Techdirt
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Re: I shouldn't say this on Techdirt
When I buy a CD I Physically have the CD
When I buy software from a store I physically have the CD/DVD.
When I buy a download there is no physical medium unless I burn it to a CD/DVD that I did pay tax on.
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Re: I shouldn't say this on Techdirt
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Well...
I will happily pay sales tax on downloads.
BUT, can we get rid of this income tax stuff?
TAX what we buy only! NOT what we earn!
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Re: Well...
Therefore since income tax isn't going away anytime soon, I'm dead against this tax. This is obviously a case of "The state wants more money, so what new taxes can we add? Oh yea, people like that iPod thingy!"
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With a physical presence, there should be tax
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California taxes all out-of-state purchases
http://www.boe.ca.gov/sutax/usetaxreturn.htm
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Re: California taxes all out-of-state purchases
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Sales Tax or DRM?
I'd be willing to pay sales tax for the rights of ownershp that (should) come along with it. Maybe sales tax would be the DRM-killer we're waiting for.
Naaah...
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Taxes for Internet downloads? R U joking!!!
Big business is trying to orchestrate a corporate take over of the internet. The government is getting in on a piece of the action by proposing this unconstitutional tax. If you look at the goals of the RIAA you will find that they are very similiar to the goals of some members of the government. You cant really tax music if it is being downloaded from public servers not owned by big business or the government.
1. The internet is not a government entity (No matter how much they want it to be). The governement proposing a tax for downloading makes as much sense as taxing someone for walking on the sidewalk in front of your home.
2. Big Business does not own, control, or mandate internet practices. The internet is a piece of technology they choose to use. If big business is unhappy with this technology they have the right not to use it. THey do not have the right to lobby congress and force their agenda's on the public when it comes to the internet.
3. Special Interest groups or memebers of the public have the right to not use the internet if they are unhappy with it. If you feel the internet should be nothing but a corporate/ U.S. government entity DO NOT USE THIS TECHNOLOGY!
This is ridiculous. Do these lawmakers just sit around trying to think of new ways they can tax the public? I would like to propose this tax- Government officials should have to pay a stupid tax. Yup, everytime they have a stupid idea they should have to pay the state and federal governemtn $10,000. This way the country would get out of debt in just a couple day.
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Re: Taxes for Internet downloads? R U joking!!!
Yep, this reminds me of a Lewis Black rant--
"We're a Two party system of Democrats and Republicans.
The Democrats, have no ideas, and Republicans have real bad ideas. The worst thing that happens is when these pricks decide to *work together*. Because what happens is that the Republicans say HEY I GOT A REAL BAD IDEA! and then the Democrats say I CAN MAKE IT EVEN SHITTIER!"
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Re: Taxes for Internet downloads? R U joking!!!
> to think of new ways they can tax the public?
Yes, that's exactly what they do. Seriously.
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Profound realization!
.... shutting off my brains.
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California Sales tax, Washington Sales Tax, Sales tax from every state which the download runs through on its journey here, The state where the server is actually located which contains the file?
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California Corruption
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Back Taxes...
I can see it now as part of an RIAA settlement suit. If you settle with us RIGHT NOW, we won't turn our records over to the "IRS".
This tax is going to promote overseas distribution of "digital downloads" that will be out of the reach of various US based tax collection. At which point, some stupid law will get passed that requires ISPs to monitor and access you a fee if you connect to certain sites. Finally followed by a massive game of cat and mouse with encryption and proxy servers.
Oh did I mention the best part of this. The "IRS" will now audit your computer and if you can't prove that you paid taxes on every song, you be accessed a standard fee per song.
Freedom
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California Corruption
What a bunch of jack asses.
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warning! you are now entering a Tinfoil hat area!
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Re: warning! you are now entering a Tinfoil hat area!
His research led him to question its very legality and constitutionality. Deeply disturbed by his discoveries, he summarized these in a report which, in February, he sent to his supervisors (At the IRS), and asked them to respond to three allegations:
1. That the filing of federal income tax returns is voluntary and the filing of federal income tax returns is not required;
2. That the 16th Amendment to the U.S. Constitution was never ratified;
3. That income taxes are not used to pay for daily government operations, but to pay the interest on the national debt.
Banister was called into his supervisor's office, and assured his report had been reviewed "by the highest levels of the IRS." Then he was handed a memo dated that day, presenting the typical non-response:
"The Internal Revenue Service will not be responding to your request and will provide you with the necessary paperwork to tender your resignation," his supervisor wrote. "You will be placed on administrative leave effective upon receipt of this memorandum for a period of seven calendar days to consider what actions you wish to take."
http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=17023
http://www.freedomabovefortune .com/
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Squee is incorrect
The 16th amendement was ratified by 48 states. A few IRS employees may have quit, but it is not likely because what they were doing was unconstitutional. Talk about an urban legend!
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Dont pay your taxes, and when you get threatened, ask them to show you the law that says you have to pay them. Then when they find it, prove that its unconstitutional.
I think I got this info from Zeitgeist the movie. Very tinfoil hat'sy but their sources looked credible.
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Re:
O.o
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When is enough enough
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Re: When is enough enough
I hate how they trot out the "we'll have to cut fire and police, and little kids will go homeless, and old grannies will starve..." rhetoric when it comes to "we have to raise your taxes because" arguments.
It's a ploy. They know that people are mostly just pushovers, and that they'll say, "oh, I didn't know that. I don't want kids to go homeless or grannies to starve. I guess I'll pay up." What government doesn't tell you is that there are probably many ancillary government jobs that could easily be farmed out to the private sector for less. Maybe a mosquito-tracking guy, or the roadcrew cone-picker-upper gal, or the setup-the-tables-at-the-gymnasium guy, or you name it.
Taxation has become a pay-for-my-government-job scam, and people eat it with a big spoon, because local and state governments and their workers' unions have gamed the system and have become expert at controlling the information you get.
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Isn't CA already taxing Apple?
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Re: Isn't CA already taxing Apple?
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Just like mail-order stores
Maybe this has to do with the store having their offices in the state or some such, but how is an online, digital goods store different from a mail-order company?
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Re: Justin and all
The State and 45 others then enacted "Use Tax" laws and businesses are audited for compliance on that as they have to report tax collections and out of state purchases for business "use" in the state.
More important is whether the State of NY is going to be able to force sales tax collection on out of state companies that have affiliates in their states and claiming that company has a Nexus in the state, circumventing intestate commerce laws that have been able to shield most companies from directly collecting sales taxes.
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again, when is enough enough?
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It's about the revenue
When the California legislature wanted to tax my DirecTV bill I complained. I wrote my California congressmen, and told them I'm getting my TV FROM SPACE! I don't use your telephone poles. I don't use any of your infrastructure. I pay for my own electricity. How can you tax my bits from space?!
I got two replies. One was from a Republican who sent a form letter saying thanks and he was against it. The other was from a Democrat which was not a form letter. He described without hesitation that the state needed revenue and that it had to come from somewhere; sorry.
Wow. It never occurs to some of these guys to actually run the government like a business. Trim it; make it more efficient. No. We need money; you've got it; we've got the power to take it from you; cough up.
I'm tired of government at all levels. I know we need it for lots of services, but I always vote for the low-tax guys now. I figure they don't have a chance in hell of actually lowering taxes, but at least they're a brake on this runaway fund-my-government-job bureaucracy.
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Companies Have to Have a
My understanding is that a "nexus" is a legal term that determines if a company has a significant physical presence in a state. It can be one single store, or a company headquarters, or a warehouse, or something else that lawyers argue about. That's why you get taxed on things from some states and not from others.
My gripe is that the system worked when there were brick-and-mortar stores, and everyone understood that sales taxes went to supporting infrastructure for these stores (i.e., sewer systems, roads, fire, police, etc.). When the politicians saw the internet sales figures climb they said "oh crap, we need some of that", and the notion of taxing for services went out the window. Now it's just taxing for revenue; like the English did to the colonies back in the day.
My understanding is that there is currently a moratorium on country-wide, all-states taxation for sales on the internet. It was championed by Congress and signed by Bill Clinton. It's probably up for renewal, but I haven't heard.
Interestingly enough, Amazon.com is a champion of collecting tax for everything from everybody. They're trying to gain favor with the politicians by picking our pockets.
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Too much
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tax
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