More on the “iPod tax”

I provided the following comment to the Engadget web site (comment 14), since the organization wrote an editorial on the proposed “iPod tax.”

I am a Wisconsin resident, and I just want to point out some objective points about this issue. First, Wisconsin already collects taxes on intangible things, such as shipping charges and certain service charges (movie tickets and video rentals, for example). Additionally, Wisconsin already asks residents to report their mail-order and online purchases and to voluntarily pay the tax on them on their state income tax returns. It is difficult to enforce, but some of us are honest (at least I am). Third, the State collects sales taxes on essentially the same product when we purchase CD’s or DVD’s; the only differences are the medium (removable optical media vs. hard disk) and the method of delivery (in-person vs. electronic download). Finally, the intent (note that I say intent) of collecting more sales tax is to reduce personal income and property taxes. The State already ranks high in the nation for collecting revenue from taxes and fees, yet it has a structural deficit in place. The structural deficit results from the size of Wisconsin’s state government.

Instead of raising taxes, Wisconsin’s Democratic Governor reports that he wants to hold the line on them and also try to provide property tax relief to the residents by reducing the State’s bureaucracy (that is, he has vowed to reduce the number of state employees). The result of the Governor’s budget will result in a long-term savings for homeowners; his opponents (the Republican-controlled Wisconsin Legislature) offered tax relief as well, but the results will be short-term, and residents’ taxes will increase after a couple of years. This information comes from the Wisconsin Legislature’s non-partisan Legislative Fiscal Bureau service agency. I hope this is objective enough. For more evidence, here is a link to the summary of the report I just mentioned: (see below).

Everyone is entitled to their opinions, but they should be based on analysis. A friend often reminds me that it is better to remain quiet and let others think you’re unintelligent than to open your mouth and remove all doubt. Personally, I buy things online if I can’t find them locally, so I intend to pay the sales tax either way.

Engadget article: Wisconsin governor seeks voluntary tax on downloads

LFB summary: Governor’s proposal vs. Joint Committee on Finance (opens a 114.9 KB pdf)