Tuesday, January 29, 2008

Nebraska seeks taxes on downloads

You don't often hear of the great state of Nebraska in the context of the entertainment industry - even although it's the only state named after a Bruce Springsteen album, but it's certainly punching above its weight at the moment.

Alarmed as CD, book and movie purchasers abandon the malls of Omaha and... other towns in Nebraska, the State Revenue collectors are lobbying to be allowed to slap sales tax on downloads.

Charmingly, the tax collectors believe the law is on their side - a precedent where an electronic mailing list was deemed to be equivalent to a paper one for tax purposes; the catch is that only companies with a "physical presence" in Nebraska would have to collect the money. So Apple, by virtue of its stores in the State, would have to levy a fiddly tax for Nebraskans buying from iTunes, whereas Amazon wouldn't.

Now, we're not tax advisors, but this sounds more like a recipe for technology companies fleeing from Nebraska rather than a shrewd way to raise extra tax revenue.