Business and economics |

Assemblyman Charles Calderon of California wants the state to consider imposing a tax on new media downloaded from the internet. He is specifically targeting goods like iTunes which are currently exempt from tax. He claims that the sales tax should apply equally to online and in store purchases.

I think he might have a point.

Please, put away your rotten tomatoes. Don’t hurl them just yet. I don’t think that California will actually implement such a tax. It’s politically dangerous (Republicans in California are already labeling it a “new tax”) and administratively, it could be a nightmare to enforce. The internet is a vast and complicated place when it comes to taxation - which is why many goods are still sold tax free.

On the other hand, many goods are not tax free over the internet. For the most part, the nexus doctrine used in catalog and telephone sales tends to apply, and it has worked fairly well. If I buy a piece a dog bowl from LL Bean over the internet, as I did recently, I pay sales tax.

Why should music be taxed differently? If I buy a CD from amazon.com, I will pay sales tax on that purchase - why should my iTunes be tax exempt?