What was that about David Williams standing against taxes? What was that about Steve Beshear being a progressive and fighting for the 21st century?
Ha, yeah, we’ve all discovered that David isn’t true to his word on that front. And Steve isn’t one to do what he says he’ll do or so much as take a stand.
The State Senate just passed HB 347 sponsored by Steve Riggs and Harry Moberly, the two people in the house who can probably barely turn on a computer. HB 347 is, well, just take a look at this recap from the Club for Growth:
HB 347 defines all sorts of digital property and places a new sales tax on it. Governor Beshear’s Department of Revenue argues against itself, saying that they already have the authority to tax these transactions, and that if they don’t pass the bill to tax these transactions, the state could lose $11 million in voluntary payments by vendors.
The upshot is that every small business and freelance creative on the web will now be burdened selling in Kentucky. Yes, this tax includes music downloads, buying stock photos and art, purchasing newspaper archives…
Really. The tax includes MP3 and iTunes downloads, digital books, artwork, digital photographs, periodicals and other newspapers and magazines, video greeting cards, audio greeting cards, video and electronic games and any digital code related to the items you purchase. Basically taxing the internet. Really.
Like Andy Hightower at the Club for Growth mentions, New York Governor David Paterson announced on Wednesday that he would no longer push for a tax of digital property in his otherwise crazy package of new taxes.
Mr. Paterson agreed to drop high-profile — and much-criticized — proposals like taxing sugared sodas and music downloads. New taxes on clothing, movie and concert tickets, video games and golf outings are also off the table, as is a proposal to limit a the tax exemption granted to construction projects.
But in Kentucky we don’t understand fancy things like the internets or learnin’… so what do you expect?
6 responses so far ↓
1 E // Mar 13, 2009 at 12:12 pm
This is going to really piss off my 13 year old daughter.
2 Conservative // Mar 13, 2009 at 12:58 pm
I’ve ALWAYS had to pay sales tax on my iTunes downloads, even before this legislation.
3 E // Mar 13, 2009 at 2:15 pm
Conservative;
I went back into her account and looked at the billing statements…you are correct…they’ve been applying sales tax for i-Tunes.
I was unaware of this, as most all of the space on my nano is news/economics podcasts…that are still free…for now .
4 Steve Magruder (I, not D or R) // Mar 13, 2009 at 2:39 pm
I run a web programming services business. While I agree there are many reasons to torpedo this bad bill, it appears that developers of custom software are mostly safe, especially those who charge by time and not by product. If I am modifying pre-written software, I charge for the time I utilize in doing the modifications, and doing the installation. I don’t charge for the pre-written software itself unless it’s not open source, but in web development, I rarely need to purchase (and pass on the costs of) commercial software for a client.
The only area that doesn’t appear safe for custom software developers is in the taxation on support contracts. If this aspect does indeed apply to custom software developers, then I envision that such developers will move to ad-hoc charging for the work time to implement bug fixes and updates (invoiced as “additional custom development”) rather than having service contract deals with customers. That’s what I do with most customers anyway.
5 Bruce Maples // Mar 13, 2009 at 9:37 pm
Interesting. We are willing to try to take on taxing every purchase of every IP item from anywhere (how do they think they’re going to do that?), but we’re not willing to tax services of any kind, even though those are much easier to find and track.
6 Thunder Storm // Mar 13, 2009 at 10:13 pm
Why tax at all? Didn’t we get Billion$ in stimulus money? Has it already been spent?
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