William F. Buckley
Congress is up against it: What to do about Internet commerce?

To return to an example given earlier in this space, you have a mother living in Hartford, Conn., who is looking for a new mattress and spots one on the Web site of a producer in Massachusetts. The feel of it is right, and so is the price, so the $500 order is placed. The mattress crossing the border is not taxed, because in writing the Constitution in Philadelphia in 1787, it was decided: No tariffs within the 13 states. Interstate commerce would be regulated only by Congress.

Which is all to the good, but Connecticut takes the position that the family living happily in Hartford has to pay its share of the cost of government, which entitles the treasury to a use tax. If the mother in Hartford who sent out for the mattress in Massachusetts were a perfect citizen, she would write a check for $30 (6 percent) to the state of Connecticut and sleep at complete ease with her conscience.

What she does do is sleep at complete ease with her conscience without sending in the check for $30. The reason for it is that taxes of that order are pretty well uncollectable. An uncollectable tax is one that would cost more to exact than profit from the yield. There is, in addition, the political question. People wouldn't like it when Big Brother stared into every out-of-state package, inquiring whether there is something in it for city hall.

So that one part of the pressure building on Congress is collectivist: to let states come in with a transfer tax. But a second pressure is from merchants who see themselves affected by untaxed transactions. The mattress maker in Connecticut is willing to compete with the company in Massachusetts, but does not like it if out-of-state businesses are, in practical terms, subsidized. That's what the non-tax amounts to. Local concerns are complaining about traffic in mattresses and books and records and computer equipment that, ordered through the Internet, come in, so to speak, duty-free.

Three years ago, Congress voted to continue until 2001 the tax-free character of interstate commerce. This meant not only a prospective loss of tax to the affected states, it meant also something on the order of a benediction on a staggering development in technology. The Internet is the happiest intellectual, journalistic and educational development in history, and the thought of letting the weeds of prehensile government crawl about it struck some as on the order of enforced shutters on sunlight, or taps on waterfalls.

William F. Buckley

William F. Buckley, Jr. is editor-at-large of National Review, the prolific author of Miles Gone By: A Literary Autobiography.

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