The AP has an article entitled Indiana lawmaker: Online tax could replace estate tax at the IBJ.
State Sen. Luke Kenley, a Noblesville Republican who chairs Senate Appropriations Committee, wants Congress to require all online retailers to collect state sales taxes. He said it would be an ideal replacement for the inheritance, or estate tax.
“It’s almost a one-for-one replacement and it’s a perfect replacement for the estate tax,” Kenley told the Times of Munster.
If you’re cool with making the tax code more regressive, I guess it’s a perfect replacement. I’m sure there is some overlap, but I have to think there is a fairly significant difference between the population of people receiving taxable inheritances and those making online purchases.
The state inheritance tax has always been pretty much a joke. It’s difficult to figure out and the person usually owes less than the attorney’s fees it cost to figure them out.
Paul is wise.
So just tax the poor and middle class instead?
Maybe we could just replace the estate tax with a tax on payday loans. It would be easy to figure out. No attorneys or accountants needed. And it would not add to the burdens of the wealthy.
I guess you could get rid of the exemptions entirely if the primary concern is that the tax owed on a $110,000 inheritance is not worth the legal fees to determine the tax after crediting the $100,000 exemption.
I’ve talked to Kenley before, he is very in-tune with the needs of senior citizens. He is anti-property tax and pro-income tax as a result. I am sure that this is another senior driven tax change.
T: How many “poor” are buying lots of stuff on the internet?
Considering the exemption is $100,000, I am not sure we don’t tax poor people with the inheritance tax as well.
That being said, taxing internet purchases is a bad idea. Of course, so is the inheritance tax.
Oh yes, the inheritance tax must go. The wealthy children are suffering under its draconian weight.
Seriously, when will this country stop treating people like gods simply because they fell out of the right vagina?
Basically favor the on line tax as can not accept the rationale given for excluding those sales from sales tax when in direct competition to “bricks and mortar” businesses. Anything to do with inheritance taxes is always held against the thought as to what is basic rationale for it besides hitting the rich which have already paid taxes on the income that was behind the estate. And with some businesses where the finances are invested in land, buildings, facilities, etc. it may mean selllng off enough of the business to destroy its ability to be profitable or maintained.
Disclosures: do shop on line and have no expectation of being any where close to being involved with estate taxes either as receipent or one having an estate subject to any taxes.
But, I’ve already been taxed on the income with which I am buying the online purchase; therefore it’s unfair to tax me again.
And the heir receiving the inheritance never paid tax on it. The transaction between decedent and heir is being taxed. If you bury the money with the already taxed decedent instead of transferring it, I doubt the government would try to collect.
By which I mean, of course, I don’t buy the “double taxation” argument. Lots of money gets taxed lots of different times when different events occur.
As I think Paul Ogden has pointed out previously, the current inheritance tax has a very disparate impact on same sex couples. Although property passing to a surviving opposite sex spouse is completely exempt, the surviving partner of a same sex relationship gets the Class C (“strangers”) exemption of $ 100 and then faces a tax rate of 10 to 20% of the remainder. What’s worse, the surviving partner in jointly held property situations like a residence can end up paying tax on something that was already theirs. And despite claims that these couples just need to have documents drawn up to be treated the same way as married folks, it just ain’t so when it comes to the Indiana inheritance tax.
I sincerely hope that the Feds would step in and add a uniform sales tax on products sold online. The traditional retailers selling any high priced items at their stores just can’t compete. The problem with the states doing it is it is very hard to police the the millions of sites selling online selling goods.
Hmm. If the feds institute the internet sales tax (ugh), then I am guessing the feds would receive it. So much for Indiana getting that money and using it to replace the inheritance tax.
Phil, online retailers are able to determine many things based off a street address for the delivery. Taxes shouldn’t be any harder.
All that is needed by the Federal government is to create the standard data format that state & local taxes will be communicated in, and provide a database that can be downloaded. States & locals would have to submit their taxes to that database, the retailers can read the database & collect the proper taxes.