The Internet Tax: One More Effort to Snuff Out Freedom

Currently, there is no sales tax for products and services purchased on the Internet.

Proponents of tax increases argue since more and more commerce has transferred from the shopping mall to the Internet, sales taxes should now be imposed on Internet purchases, as well.

The problem is that sales taxes are imposed at the state or local level. How is a business to keep track of 50 or 1000 different sales tax policies in as many tax jurisdictions? and other large companies have no problem with the law. They realize it’s probably coming sooner or later anyway, and while they don’t relish another tax, they do relish the opportunity to beat out smaller competitors who can’t handle the nightmare of confusion and record-keeping required even to properly pay such a tax.

A tax on the Internet would not only be a tax increase; it would be a massive imposition on small and medium-sized businesses. It will be bad for all consumers, because it will make large companies like less responsive to consumers, as they face less competition in the marketplace than they otherwise would.  

If you think our economy is in bad shape now, just wait until the Internet tax is imposed. It’s unclear whether the House of Representatives will pass it, but it’s moving through the U.S. Senate and Obama, of course, stands ready to sign it into law.

Many articles report that politicians in both parties like the tax, because it will bring more revenue to their state and local governments. State and local governments are strapped even more badly than the federal government, because many of them have balanced budget laws to constrain spending, and none of them can arbitrarily generate currency (i.e., print money) as the federal government and Federal Reserve can.

What’s amazing to me is not that government is about to impose another tax. That’s what our government does, and it’s pretty much all our government does (aside from nationalizing or hyper-regulating industries to the point where they can barely function). I’m also not surprised to see ‘small government’ Republicans cave. Caving, for the most part, is what Republicans do.

What still surprises even me is the blatantly dishonest reasoning given for justifying such a policy. Our rulers tell us it’s a good thing because it will help state and local governments. But state and local governments are no different from our national government. They don’t spend the vast majority of their money on protecting individual rights, or doing conventional government tasks such  as employing firemen or paving the roads. Governments at the state and local level, particularly in places like California but many other states as well, are all about the transfer of wealth, paying off huge sums and benefit packages to ‘public servants’ such as teachers who don’t teach, and making sure that people become dependent on government services or handouts rather than even having a chance at functioning in a free market economy.

By what right or rationale do we justify new taxes so that state and local governments have it easier? What about the people who produce the income and make the taxation possible?

The fact that this point goes largely unchallenged, by most Republicans as well as all Democrats, shows just how much our society has become one in which the people serve the government, rather than the other way around.

Of course, strictly speaking, it’s not the people serving the government. It’s some people being forced to serve other people — politically favored pressure groups — via government coercion. Objectively speaking, this is most of what our governments (local and national) actually do today.

There’s talk of how our multiple trillion dollars in federal debt is unsustainable, especially if the economy continues not to grow very much and unemployment remains high. This talk is entirely valid. But even more important is the fact that government is sacrificing and coercing one segment of the population — those who produce at their work, on whatever scale — for the sake of those whom the government pays not to produce, work, or purchase services for themselves.

Increasingly, our government is little more than an organized mafia, conning or intimidating some to pay off the government bullies in order to avoid trouble. It’s an organized game of blackmail, but much worse than conventional blackmail because it’s done under the legitimacy and legality of government — and under the high and mighty, self-proclaimed morality of ‘altruism,” an approach to ethics which most realize is futile and insane, but few will dare question aloud.

It’s a multiple-trillion dollar scam, one growing more rotten every day — the worst scam, I would argue, in all of human history, not only because of its scale but because of the great economic engine of the USA it is systematically destroying. I don’t know how much longer the productive victims of this scam will put up with it, but I know that sooner or later the whole thing will collapse on itself. Human nature and simple facts / logic make that inevitable, and only the date and the nature of the collapse remains in question.

An Internet tax is just one more assault on productivity and self-reliance—the latest in a long line of successive blows to what might have otherwise been a dynamic, always-growing and ever-productive society of free, self-responsible and innovative individuals.

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