IPI Publication Press Release
IPI Ideas - # 18
Related Publication Title:
Business Activity Taxes--The Next Internet Tax
Released by Bartlett Cleland on 03/21/2003
IPI Ideas - # 18
Related Publication Title:
Business Activity Taxes--The Next Internet Tax
Released by Bartlett Cleland on 03/21/2003
Full Text
Press Release (03/21/2003)
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With States in Search of New Tax Revenues, Businesses at “ORANGE” Risk for Taxation
FOR IMMEDIATE RELEASE: Friday, March 21, 2003
CONTACT: Misty Woodruff, 972-874-5139 or misty@ipi.org
DALLAS, TX – With many states hurting and hunting for new revenue sources, businesses are under “high alert” for tax invasion in the form of business activity taxes (BATs).
For example, states are claiming that viewing a company’s website, the presence of a computer server, or the use of an Internet service provider provide sufficient reason for taxing that company, even though the company may have no or little physical presence within the actual state.
According to a newly released publication by the Institute for Policy Innovation, such states are wrongfully pursuing business activity taxes (BATs).
Unfortunately, there is no uniform standard in the application of the standard, and interpretation varies from state to state, but generally, BATs are levied when a company has a substantial presence in a state.
“In the digital world, these determinations are particularly critical,” says report author Bartlet Cleland, director of the IPI Center for Technology Freedom. “As intangible property continues to become a greater part of our economy, clear rules that consider the realities of the digital marketplace are a necessity.”
“Congress must determine bright line standards that are not subject to the creative whims of an over-zealous tax collector,” continues Cleland. “Digital activities within a taxing jurisdiction should never provide a sufficient basis for a state or locality to levy a tax on a company not otherwise present within that jurisdiction”
Until the inconsistency is resolved, double taxation, costly litigation to companies, and ultimately increases consumer goods is the sad reality.
MEDIA NOTES: Mr. Cleland is available for interview. Contact Misty Woodruff at 972-874-5139 or misty@ipi.org.
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