That Ugly Old 'T' Word
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If you're running a retail e-commerce site, you definitely don't want to hear this: Taxation of e-commerce is inevitable.
At least that's the view expressed by author Thomas W. Bonnett in his new book, "Competing in the New Economy: Governance Strategies for the Digital Age," just published by Xlibris.
Currently there exists a moratorium, which was created by the Internet Tax Freedom Act, providing that there should be no new taxes on Internet access services, and there should be no multiple or discriminatory taxes on e-commerce. That extends through October of next year.
In addition, the act created the Advisory Commission on Electronic Commerce, which has issued a report to Congress.
Bonnett's book, available at publishing site xlibris.com, explains how globalization and information technologies have shaped the New Economy, and how knowledge has become its key input. The second half explains how and why the public sector should restructure its operations, embrace information technologies, and improve the quality of public services to attract the knowledge workers driving this New Economy. An excerpt is available here.
The Advisory Commission made these recommendations to Congress:
- Repeal of the federal three-percent excise tax on each consumer's local and long distance telephone bills
- A prohibition on taxation on Internet Service Provider access charges
- Clarification of "nexus" rules to more clearly define the circumstances under which businesses must collect sales taxes on remote sales and when they must pay business activity taxes in a cyber economy
- An extension of the current moratorium on multiple and discriminatory taxes on the Internet and e-commerce
- Simplification of state sales tax systems