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Washington State’s Taxing New Law

It’s days like today that I really despise living in Washington State. Apparently, our elected officials have decided to subject us to a tax that, in my opinion, is even dumber than a semi-recent law that made it illegal to even write about, much less link to, online gambling Web sites. No, I am serious.

This time, however, elected “officials” in Olympia have decided that we need a tax so unlikely, so difficult to even fully understand, that it needs an FAQ just so a person can get their heads around exactly what is being taxed.

So what is being taxed exactly here in the Great State of Washington? Digital downloads. Yes, MP3s, software, it’s all here.

What is exempt, then? Freeware and SOME open source software. Yes, according to the given exemption rules that I am reading, it clearly states:

Yes. Digital goods that are not offered for sale are exempt from tax when they are:

  • Noncommercial (such as personal email communications).
  • Created solely for an internal audience.
  • Created solely for the business needs of the person who created the digital good and is not the type of digital good that is offered for sale, such as business email communications. (See section 605 of the digital products bill).
  • So it seems, potentially, open source not being sold yet used in an enterprise setting, could be taxed. Should be interesting calculating the tax on ZERO!

    But maybe there is a bright side; perhaps Washington thought this through enough to realize just how incredibly unenforcible this really is? And hey, what better thing to do when commerce is slowed down than to tax something, right? Give me a break. It’s days like today I miss my old home state… Alaska.

    4 Comments

    This sounds like the standard Oly gimmik, they are famous for coming up with absurd taxing ideas, part of the reason we’re not terribly disirable to business.

    Money lenders virtual free ride on the internet, per Webster Tarpley re: California:

    California needs revenue, but the average person is overtaxed already. The biggest untapped income stream in California is financial speculation. Most Californians pay almost 9% in a regressive sales tax,

    but, Bankers and Hedge Fund operators pay nothing, zero, nada, on their massive daily turnover of DERIVATIVES, OPTIONS, FUTURES, STOCKS, BONDS, FOREIGN CURRENCY, and other SPECULATIVE PAPER. Surely these financial interests should pay their fair share to meet this crisis.

    We must therefore impose a Tobin tax or Securities Transfer Tax (STT) of one percent (1%) to be paid by the broker on all financial transactions in this jurisdiction…

    http://sn.im/spectax

    I certainly share your frustration at my home State’s propensity to tax everything. However, your statement that you despise (at times) living in the State I was born and raised in, and your longing for your home State is rather strong and insulting those of us you have spent our entire lives here.

    As far as I know we haven’t as yet passed any law that requires you to remain here. So, go home.

    Frederick Freeland, Jr.

    June 10th, 2009
    at 12:13pm

    What else would you expect from the brain of former Microsoft Program Manager Ross Hunter now turned ambitious politician. He turns on the industry that actually put him in a position to run for and achieve the position he now holds in the state legislature. It’s a sad commentary that this former software program manager would be so narrow-minded in his view of the business model when it comes to leveling the playing field for downloaded media. Does he not understand that customers can just as easily download material from another state where no such taxation will take place. In the end not only does the tax revenue leave the state of Washington, but so does the business. Now that’s forward thinking, isn’t it Ross?

    What Do You Think?

     
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