Thursday, May 08, 2008

Tax Now and Ask Questions Later

In discussing New York State's ill-advised attempt to tax internet sales, Nashville attorney and blogger Nathan Moore reminds the reader of an important political and economic point:

Amazon is likely to prevail, but not before the grace period for registration passes, leaving them (potentially) on the hook for back due taxes and penalties if they do in fact end up losing the fight. These kinds of attempts at taxation are akin to imposing tariffs between and among the states. One of the central and most overlooked reasons the United States has been such a successful country is that the fifty states are the largest free-trade zone in history. Regional comparative advantage, the free flow of capital and the unrestrained flow of labor is built-in to the domestic American economy on an unparalleled scale.

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