Wireless Wave - Spring 2008 - (Page 40)

▼ ▼ “STATE” of Mind There K. DANE SNOWDEN CTIA Vice President, External And State Affairs was a time when we thought talking on the phone without wires was the stuff of science fiction. One could only imagine a day where we would watch TV, surf the net, pay bills and download content. Today, the idea of Mobile Commerce is not science fiction or the idea of tomorrow…it is here today and is creating a digital economy that is changing the way we work, live and play. As consumers march down the mobile commerce highway, we are seeing potential speed bumps in the road ahead. One of the biggest of these speed bumps comes from the taxation of digital goods and services. State legislators continually analyze taxation levels in order to predict shortfalls and windfalls. After all, state governments are in the business of managing budgets and promoting the local economy. Sales tax is, for most states, a critical component in maintaining the balance between these goals. Legislators watch with interest as mobile commerce trends offset traditional forms of consumer spending. As a result, the so called “digital economy” products are now firmly on the radar screen of states and the temptation to tax is simply irresistible for some. The wireless industry has long supported the Streamline Sales Tax Project (SSTP). This project is a federal and state effort tasked with developing the requirements a state would need to meet in order to extend sales taxes to digital goods such as ring tones, music and videos at a single point of the tax process. The taxing of these goods is not required under SSTP. However, some states are in fact unable to resist the temptation to tax digital goods. Already this year, we have seen Nebraska, South Dakota and Indiana move in the direction of taxing digital products and more are expected to follow. Accordingly, as states move forward with proposals to expand these taxes to digital goods the debate should focus on the merits of adopting this policy. Digital goods should only be considered for taxation if their “functional equivalents” are taxed as well. For example, if CDs are subject to the tax then it seems logical that the tax should also apply to downloaded music as well. But if there isn’t parity, the tax should not only apply to wireless. Historically, the tax laws have done a good job of avoiding taxation at each point along the avenue of commerce. This helps avoid “tax pyramiding” or the inevitable multiple bites of the same apple phenomenon. The wireless industry believes this is an issue that will require ongoing advocacy. The existing sales tax structure was developed and based upon a manufacturing economy and as we move to a mobile commerce society it makes no economic sense for a state to tax the golden goose again and again and again. Consumers deserve better. Mr. Snowden has been a member of the Advisory Board for the Rehabilitation Engineering Research Center on Mobile Wireless Technology for Persons with Disabilities (Wireless RERC) for five years and a member of the Access Board TEITAC Federal Advisory Committee. W ir e l e s s W a v e 40

Table of Contents Feed for the Digital Edition of Wireless Wave - Spring 2008

Wireless Wave - Spring 2008 Contents A Letter from Our Chairman A Letter from Our President Pryor Approval The Promise of M-commerce Moving Targets Foreign Service Multiple Choice Legs, Regs, and Wireless Wireless News The Supplier’s Voice CTIA Welcomes New Members Index of Advertisers Roaming with….

Wireless Wave - Spring 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.