New York wants a share of iTunes' money.
The state is staring at a $15.4 billion deficit so Gov. David Paterson is proposing an "iPod tax" as part of his state budget. Under the plan, New York would charge state and local sales tax for "digitally delivered entertainment services," according to a story in The New York Daily News.
That includes e-books downloaded to Amazon's Kindle as well as for the digital songs obtained from Apple's iTunes. If the state legislature passes the governor's plan, the price of digital content for New Yorkers is sure to go up. The tax would also apply to sporting events, movie tickets, taxis, and satellite TV and radio.
Wow. To some Manhattan residents, Hoboken, N.J., may be looking better all the time. But wait, New Jersey is among the 17 states that already tax downloads, according to my colleague Stephanie Condon. She wrote back in August that states taxing digital entertainment include Alabama, Arizona, Colorado, Hawaii, New Mexico, Texas, and Washington.
California and Wisconsin considered similar proposals, but they were defeated. Tech industry groups like NetChoice, which counts eBay, AOL, and Yahoo as members, have been lobbying against the rise in so-called iTaxes.
Online electronics retailer Newegg has stopped charging sales tax to its New York customers, according to a posting on the Consumerist.com.
The move by Newegg reverses action the online retailer took in June, in which it began to charge applicable sales tax for all shipments to New York, following passage of a new state law that required certain companies to charge sales tax on shipments to New York state.
Effective August 21, however, Newegg discontinued the practice and is leaving it up to New York residents to pay that sales tax themselves. That policy basically returns the responsibility of paying sales tax for online purchases back to the New York consumer, which was the case prior to the New York legislature passing its law earlier this year.
Newegg is not the only retailer taking a stand against the change in law. Earlier this year, Amazon.com filed a lawsuit against the state, claiming its law was "invalid, illegal, and unconstitutional." And online retailer Overstock has taken similar legal action. Amazon, however, has since said it will abide by New York law and collect the taxes.
Calls to Newegg were not immediately returned.
- prev
- 1
- next
