Category: Internet Law

Internet Sales Tax Bill Faces Opposition

The Marketplace Fairness Act that will allow states to collect sales taxes for online purchases is facing opposition from a select group of senators whose states don’t tax sales.

Current laws allow states to charge sales tax on online purchases only if the vendor has a physical presence within the state’s borders. This results in a huge amount of internet sales going completely untaxed. A result of this is that it is difficult for brick and mortar stores to compete with online vendors, since most consumers would rather wait a few days for their purchase to arrive than pay the sales tax. The inability for states to charge their sales taxes on the internet cuts into their revenue significantly. In fact, the National Conference of State Legislatures estimates that states missed out on $23 billion, from $226 billion of online sales that would have been otherwise taxable. That’s $23 billion that could have gone back to the public to improve infrastructure or education, an average of $500 million for each of the 46 states that charge sales taxes.

Opponents of the bill argue that it forces the states where these online retailers are based to collect the taxes of other states and that the regulations it would create would be too complicated. They also argue that it doesn’t offer enough protections for small businesses, despite the fact that businesses whose online annual sales total less than $1 million dollars would be exempt.

Senate opposition to this bill is small, but its few opponents are trying to do everything they can to delay the vote. However, opposition in the house may be much stronger. Senate majority leader Harry Reid vows that this bill will receive a vote before the senate is dismissed for vacation next week, which is great because this is really a no-brainer. If people get upset about others using overseas bank accounts to avoid taxation, they should be similarly upset about those who specifically make purchases on the internet to avoid taxation.

House Blocks CISPA Social Media Privacy Amendment

An amendment to the Cyber Intelligence Sharing and Protection Act (CISPA) that would have prohibited employers from being able to demand social media passwords from their employees failed to pass in the United States House of Representatives.

The failed amendment was tacked onto the larger CISPA bill, which aims to increase the nation’s cyber security by allowing corporations to share private information with the government, superseding any privacy agreements they may have had with their customers. This removes the corporation from any civil liability for breaching their privacy agreements and will allow them to share customers’ personal emails with Big Brother in the name of “national security.” CISPA passed in the house by a margin of 288 to 127.

CISPA has yet to pass in the Senate, and President Obama’s advisors have publicly stated that they will recommend he veto it.

Many representatives are of the opinion that prohibiting employers from demanding employee social media login information should be addressed in its own legislation rather than tacked onto a broad cybersecurity bill, and I’m inclined to agree with them. The representative who proposed the amendment, Ed Perlmutter (D-Co.), has been accused of attempting to derail the passage of CISPA, which tarnishes his worthy proposal. If I were him, I’d keep my brainchild as far away from this trainwreck of a law as possible.

Indecent Proposal

Last Friday, three young girls filed a lawsuit against Backpage.com for allowing them to be sold for sex.  The girls were captured by pimps after running away from home and then required to participate in various sex trafficking activities such as posing in lingerie.  One of the girls was 13 years old, and another only 15.  The lawsuit is intended to hold Backpage.com responsible because they “allowed” the advertising of underage girls.

The suit refers to the Communications Decency Act of 1996, a document intended to protect service providers from the opinions and statements of their users.  A federal judge declared that Backpage.com should be required to advertise the ages of their girls, but Backpage is arguing that this violates both the Communications Decency Act, the Commerce Clause of the Constitution, and the 1st and 5th Amendments.

I’m unimpressed that Backpage.com has not accepted this arrangement and instead, has chosen to fight the people that work to put an end to child-sex trafficking.  Although they have every right to defend themselves, there are some situations in which public decency should trump self-defense.