Taxing online sales
Australia is not the only country with a messed up sales tax system. The Wall Street Journal recently questioned US Congress’s consideration of the proposed federal law authorising states to impose their respective sales tax on remote sellers, criticising South Dakota for trying to tax internet sales. NRF pointed out that unfair competition from remote sellers exempt from the combined state and local sales-tax (charged at the rate of 6.5% in South Dakota) causes many local retailers to fail. Yet, Canberra politicians keep claiming that a 10% price difference is immaterial, therefore, there is no rush to tax overseas internet purchases - a view that is on the verge of commercial insanity. In retail, a 10% price difference is a matter of life or death.