Tennessee’s Governor has decided that he, too, wants to tax the internet.
Gov. Bill Haslam said Wednesday that untaxed Internet sales are eroding Tennessee’s tax base and said he’s willing to take a leadership role among governors in urging Congress to pass a national approach to collecting sales taxes on goods sold over the Internet.
In other words, Haslam wants to push internet retailers out of his state, as even CNN points out that states that adopt such measures tend to lose tax revenues instead of the opposite.
In other states, such taxes have backfired, according to John Henchman of the Tax Foundation, a nonpartisan group that opposes the such taxes. Henchman has noted that tax receipts have actually fallen in Rhode Island and North Carolina as a result of the imposition of “Amazon taxes.” A big affiliate, FatWallet.com, fled to Wisconsin from Illinois after the latter state imposed such a tax, he notes.
I can’t confidently predict what would happen if such tax rules went into effect nationwide, but given the long-established truism that what you tax you get less of (even Democrats tacitly agree with this, given their support of cigarette and other sin taxes), I’d bet the results wouldn’t be pretty.