Surprise, surprise. The federal Advisory Commission on Electronic Commerce couldn’t reach a consensus last week on how to collect taxes on Internet-based sales. Who didn’t see that coming from day one?
Congress created the 19-member commission with the onus that any resolution must be passed by a super-majority, or two-thirds, of the members. And remember, this group is made up of state, local and federal lawmakers like Virginia Gov. James Gilmore, the commission’s chairman and a Republican who is against taxes, and Dallas Mayor Ron Kirk, a Democrat who is for taxes. Toss in a few business executives like AT&T chairman/CEO C. Michael Armstrong, America Online president/CEO Robert Pittman and Gateway chairman Ted Waitt, all of whom are against taxing the Internet for obvious reasons.
It’s no wonder that 13 of the members couldn’t come to a consensus on the business faction’s compromise proposal. (Actually, all 19 agreed on one issue: Surplus welfare funds should be used to buy computers for the poor and to provide them with access to the Internet.) Even more unfair is the fact that seven members – including the Clinton administration’s three appointees – abstained from casting their vote for or against the compromise plan. Just what did that accomplish?
Clearly, some of the ambiguous nexus issues that have come up since the U.S. Supreme Court issued its Quill decision eight years ago need further explanation. If the commissioners succeeded at one point, it’s that this will force state governments to simplify their tax systems. But Congress shouldn’t have wasted the past year and a half waiting just for that.