Bought something on the internet the other day. Clicked on an icon that said, “calculate sales tax.” It was optional, but I clicked on it and was told my purchase would entail $1.79 in sales tax.
Did I regret clicking on that icon? Not at all. Just a half-hour earlier I had shopped for a similar item at a brick-and-mortar store and hadn’t seen anything I liked. If I had bought that item at that store, I would have paid about that much in sales tax anyway. So by clicking on the internet icon, I—to use a cliché—levelled the playing field. And I remained a law-abiding citizen.
Please don’t congratulate me for my fairness. I’m sure I could have found something better to do with that $1.79 than give it to the government which—to use another cliché recently spoken—doesn’t know how to spend my money as well as I do. I just felt that since the U. S. Supreme Court has said states can collect sales taxes from out-of-state internet vendors I should respect the majority opinion of our highest court.
It has not been a surprise that a member of the legislature quickly has come to my rescue. And his reasoning is no surprise, either. This legislator considers imposition of the Missouri sales tax on internet purchases made by Missourians to be a sales tax increase and thinks the state needs to provide some relief for such an onerous imposition.
Pardon us, however, if we have trouble understanding how the state collection of sales taxes on internet purchases is a tax increase. But if we accept that line of thinking, why accept the convoluted solution that goes with it? We have a far better one and one that without doubt would be much more politically popular.
The idea put forth in the proposed legislation is to cut individual income tax rates even more to offset the internet sales taxes that income taxpayers might soon have to start paying. The idea seems premature because it’s going to take some time to make it legally and mechanically possible to collect those sales taxes. Then it will take some time to get a consistent measurement of how much those collections will be and how Hancock limits affect them. A little less enthusiasm for immediate remedies to the “problem” of collecting internet sales tax might be advisable because there are other issues to be considered.
Think of all of the Missourians who shop locally and pay the state sales tax. They are good citizens. They follow the law. The law says those Missourians will pay sales taxes. They obey the law.
Where is their outrage or political outrage on their behalf—the good citizens—when other citizens avoid following the law by using the internet to avoid paying the sales tax on the things they buy? Tax avoidance often lands some people in the pokey—unless its sales tax avoidance by using the internet. It seems this early legislative proposal legitimizes their tax avoidance.
I’d be willing to bet that many Missourians intentionally avoid paying state sales taxes at felony levels each year. They keep their $1.79 and are never prosecuted for avoiding the sales tax law.
Let it be clearly stated: Requiring citizens to pay a tax they have avoided paying is NOT a tax increase. It is a matter of fairness. It is requiring the sales tax scofflaws to live by the same standards with which their shop-local fellow citizens live.
Here is an idea that is eminently fairer: Eliminate the sales tax for everybody.
Clearly, there is within the philosophy that the state should not recognize additional funds by collecting taxes from people who should have been paying them anyway, an implied acknowledgement that adequate funding for state programs and services and bureaucrat salaries is not a matter of concern.
So let’s just level the playing field by eliminating the sales tax on everything. That puts our local businesses on an equal footing with internet sellers—in fact, it might give them an advantage because they don’t charge shipping fees for local purchasers.
To carry out contemporary political thinking: Eliminating the sales tax will trigger a boom in local retail sales, thus providing more jobs that generate more income taxes that will offset the loss of sales tax revenue.
Let’s not make this thing more complicated than it is. There’s no reason to start calculating income tax cuts. Just get rid of all sales taxes, period. That makes everybody equal.
After all, I could have done a lot of good things with that $1.79 if I hadn’t been honest enough to pay a sales tax.