The Cedar Rapids Gazette Tries To Make Us Feel Guilty For Shopping Online

From the Cedar Rapids Gazette:

A rosy outlook for holiday online sales won’t do much to improve the bottom line for struggling state and local governments because of lagging tax collections.

Online sales have been increasing ever since businesses started selling stuff over the internet.  This is a trend that will continue for probably most of our lifetimes.

As for the notion that state and local governments are "struggling... because of lagging tax collections", can anybody tell me how many state and local government employees have been laid off recently?  How many departments have been closed?  Hello?  Do we have those figures, Gazette?  Last I saw, the borrowed Federal stimulus and borrowed iJobs money was keeping the leeches and their cousins afloat.

Like Main Street and mall retailers, online retailers provide goods in exchange for dollars, but when it comes to taxation, online retailers are often treated differently.

E-tailers, as they are called, generally aren’t required to collect state sales tax from orders shipped to states in which they have no physical facilities, under a 1992 Supreme Court decision. They do collect state tax in the states where they’re physically located.

Quill Corp v. North Dakota is the case.  It's an interesting one since the original North Dakota law was enacted in 1987, nearly a decade before the modern era of the internet and shopping using web browsers.

Individual consumers in Iowa are expected to track their online purchases and pay a consumer’s use tax on non-taxed transactions to the Iowa Department of Revenue.

The state revenue department, however, has no way of collecting taxes that buyers fail to report. Iowa officials don’t even know how much tax goes uncollected from online sales, revenue spokesman Roger Stirler said.

This is such a dumb law.  It ought to be repealed, along with most of the Iowa tax code in favor of a more simplified flat tax.  I'll be bitching more about the Iowa tax code in a few months when I attempt to fill out tax forms involving two states, one of them being Iowa. 

Iowa’s major effort for improving tax collections from online sales is membership in Streamlined Sales Tax, a voluntary organization of states trying to make tax compliance simpler for e-tailers and other companies that sell items throughout the nation.

Iowa collected $12.3 million in sales tax through the system in fiscal 2010 — much less than projected a few years earlier when the state announced its participation.

Iowa's been part of the Streamlined Sales Tax since 2005.  Read about what a nightmare it could be for retailers if it was ever truly enforced.

I'm curious what the State originally projected revenue to be under the Streamlined Sales Tax when it came out in 2005.  I tried to Google but came up with nothing.  If anybody has better databases to look through give it a try and send an email.  What do you want to bet their projections were somewhere between $50 million and $100 million a year by 2010?

As for the story in general, it sadly comes with a lot of pro-government bias.  It's all your fault that the government doesn't have enough money!  What is that?  Why are newspapers advocating on behalf of wasteful entities like government?  Why are they pushing, as this story does, ridiculous amounts of paperwork and accounting on the backs of business owners and individuals so the state coffers can have a few million bucks?  Who is standing up for the individual and the shopkeeper?  Who is standing up for efficiency and sensibility rather than complexity and confusion?  Not newspapers.