New Jersey is proposing...
New Jersey wants tariffs on online music sales. Could this be the start of something big?
NEW YORK (CNN/Money) - They want to tax my Who. And my 3 Doors Down. And my Dr. Hook and the Medicine Show.
Sure, if I had their albums I'd have already paid the tax. But I don't. I got their songs from the Internet ... Napster (the legal one) and iTunes, to be exact. And I listen to the songs a lot.
But now my state legislators, some of them at least, are talking about taxing my downloaded songs. Yep. A budget committee in the New Jersey legislature just approved a measure that would slap the state's 6 percent sales tax onto music downloads. So my Alan Jackson download would go from $0.99 to $1.05. This and other tax moves ... like taxing gym memberships ... would add $175 million to state coffers.
Now I understand some of the logic for imposing taxes on Net-based sales. The bricks and mortar guys have to collect sales taxes, so why shouldn't the folks who compete with them over the Internet?
Except that my local Sam Goody won't sell me the Grace Jones single I want. I have to buy the whole CD. And the local bookshop isn't going to deliver the next Harry Potter to my door. I'm paying Amazon and FedEx (indirectly) for that.
"They're trying to tax ether!" squawked a libertarian colleague of mine. I don't know if I agree with that. Digital or not, my Guns N' Roses still sounds real to me.
Yes, the drumbeat for Internet sales taxes is growing. States need the money. Some are already making a stab at getting it at tax time.
Nevertheless, the song sellers don't seem too worried.
"It is premature for us to comment on the implications of a proposal that has not yet been accepted," Napster wrote in an email response to my queries. "However, this is among the issues we are monitoring for future developments."
Apple had no comment. Guess this isn't enough for them to think different on.
And so my songs are probably going to get taxed. But there will be a fight first. The governor of Wisconsin pushed a similar proposal, but it went down in flames last May. That gives me hope for New Jersey, where the final votes have not yet been taken.
Maybe the gym guys will stop it.