http://www.dailygazette.com

Quoted Text

Spitzer may be learning

   Few New Yorkers seemed to even know that Gov. Eliot Spitzer had decided to tax Internet vendors for in-state sales before senior administration officials announced Wednesday that the plan was being abandoned. People’s ignorance probably had something to do with the fact that the memo targeting the companies doing online business had been sent out just three days earlier, on a Sunday — a day few reporters are on the job. Then, on Monday, other issues (e.g. the governor’s ill-fated driver’s license plan and more fallout from Troopergate) kept the media and public from focusing on Spitzer’s latest political blunder. Lucky for him.
   Much like his license plan, this was another principled fight that Spitzer would have stood little chance of winning. His rationale was that if an out-of-state vendor derives a sale from a referral (“link”) provided by a New York-based Web site, the out-of-state vendor ought to be taxed as if it also has a physical presence in the state. Physical presence (e.g. a store or warehouse) is the criterion used to determine whether a mail-order operation is taxable, so the governor’s logic wasn’t so off-the-wall. And with the state facing a budget deficit of $4.3 billion next year, one could hardly blame him for wanting to pick up an easy $100 million.
   Except, of course, that it wouldn’t have been easy: Americans, and their leaders, have come to see tax-free Internet sales as an inalienable right. Whoever proposes otherwise had best be negotiating from a position of strength. Thanks to Troopergate and the licensing scheme, that would hardly be the governor just now. With the holiday shopping season just around the corner, we could just hear Assembly Minority Leader Jim Tedisco and other adversaries lambasting him as Scrooge and the Grinch who tried to steal Christmas.
   A lot of states would love to get their hands on the revenue from Internet sales, and someday they probably will. But like immigration reform, this is an issue that would best be handled at the federal level. So far, Congress has had little motivation to attack this very real problem (Internet vendors not only deprive states of sales tax revenue but hurt traditional retailers, who pay property and income taxes), and tax-phobic President Bush, naturally, has been dead set against the idea.

  
  
  

The underground needs to get their hands on more of NYS taxes????

MR.SPITZER
MR.TEDISCO
MR.BRUNO
MR.SILVER