On Internet Taxation ..

Maurice’s friend, Bob Anderson, wrote the letter below to the “Sheridan Press” in Wyoming in response to US Senator Enzi’s support of taxing the internet.

Of course, the administration of the Federal government will always be in favor of more taxes to spend on socialistic programs.  Otherwise hard working, dedicated men who consider themselves Conservatives are continuously duped into attacking free market businesses and ideas in the name of supporting the “little guy.”  Their actions suppress innovative entrepreneurship and free market choice and promote creeping Statism.  New taxes do nothing more than penalize consumers (who always ultimately pay all taxes) and drive our businesses and labor to foreign shores.  We should constructively chastise our well meaning politicians when they transgress, for their actions are giving aid and comfort to the enemies of our Republic … the totalitarian socialists that intend to do away with our constitutional freedoms.


He wrote:

Mr.Woody:  Just a short response to the Sheridan Press news report yesterday about Senator Enzi’s legislation to impose a Federal mandate on internet sellers.  The Wall Street Journal published an editorial on Enzi’s proposal this past week pointing out the harm it will inflict on one of the most rapidly growing small businesses in our country.  I kept my comments below to 350 words, even though I was sorely tempted to go after the political ethics of this legislation as well.  I’m sure you’re aware of how much special interest money has been lobbying for this Federal mandate against internet sellers and buyers from both state governments and large retailers.  It reminded me of how everyone loves competition unless, of course, it’s directed at them!  Hope you will publish my letter so the “forgotten consumer” can see how another piece of legislation undermines his economic well-being.  All my best, Robert G. Anderson


The letter:

Crony capitalism and the tax man seem to be winning again, this time at the expense of millions of internet buyers and sellers.  The lobbyists on K Street found another compliant politician, Senator Enzi, willing to do their bidding to accommodate their big retailer clients and state governments seeking more tax revenues.

Senator Enzi, of course, claims “fairness” as the motive for his actions.  He argues “it’s only fair” that all buyers must pay sales taxes, irrespective of where purchases are made.  His rationale that everyone should pay equal sales taxes is more a mentality rooted in the politics of envy than “fairness.”

But it’s the legal implications of Senator Enzi’s reasoning which are most concerning.  Senator Enzi’s legislation would brand internet sellers as Federal criminals if they do not collect and pay state sales taxes to thousands of political jurisdictions outside their domicile state, taxes which other states have imposed upon their residence buyers.


The argument is that “it’s just too difficult” to collect state sales taxes from resident buyers who owe them, so therefore we should make out-of state internet sellers collect them, and if they refuse, make Federal criminals of them.  (That used to be called “taxation without representation.”) If Senator Enzi’s legal scheme does become Federal law it surely will be constitutionally challenged in the courts.

It’s a legitimate question under the commerce clause whether the Federal Government, or certainly state governments, can force out-of-state internet sellers to collect and pay sales taxes owed by buyers of other states.  The question is whether Senator Enzi’s Federal internet sales tax legislation can impose and enforce a national mandate on internet sellers to do this, something which the states could not alone achieve constitutionally?

Senator Enzi has compromised his elected role representing the general interests of his voting constituency when he caters to the lobbyists of large retailers and state governments by imposing more new costs on consumer taxpayers.  It’s merely another commentary on how crony capitalism has captured our political system as politicians peddle the politics of envy disguised by phony claims of “fairness.”

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