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Are you Willing to Pay Taxes For Your Blog?

In “Taxes Have No Place On The Internet” by Don Reisinger on CNet’s Digital Home, he makes an important point that I thought would have gotten more discussion and coverage:

The ban on the Internet tax is one of the most compelling and important bills to cross legislator desks in years. A tax of the Internet would be an utter mistake that could cause even more ridiculous spending on the part of this government at the expense of hard working individuals that rely on the Internet for entertainment, well being, employment, or any combination of those attributes…

We live in an environment where we’re overtaxed and under-rewarded. With grand promises of better education, more paved roads and public works, lawmakers do whatever they can to take our tax money. And unfortunately, we sometimes fall for it.

But when it comes to the Internet, there is no good justification for taxing our access. I hate to get too deep into this discussion, but in my mind, a taxed Internet means less disposable income that can be used on something far more important — your family.

The rumors of an Internet tax has been going around for years, but now the US government, and many governments around the world, want money from the new economy called The Web.

There are many levels to Internet Taxes. There is the issue Reisinger addresses which is the application of a tax on Internet Providers for every user on the Internet. It could be that you might soon be paying for your blog, or at least access to it. But how far will this go?

It used to be easy to buy things on the Internet and not pay sales tax for purchases outside your state. Now, that’s not longer true nor consistent.

Collecting taxes is expensive. Accounting for taxes within businesses is expensive. Getting your own personal taxes figured out is expensive. All is time consuming and time costs money.

And what about all that money you are making on the web? Are you paying income taxes on it? Do you even report it? Do you get tax reports on the income you earn from the various advertisers, and do they in turn report your income to the government as is required by some countries? Which government? The one the company is based in, or yours?

Do you want to pay a tax for having a blog? Do you want to pay taxes on your email services? What about paying a tax fee for every dollar generated from the ads on your blog? It’s a “sale” in one way of thinking, right?

Taxes and the Internet are a messy business, but there are billions to be made in taxes if the governments can come up with ways to grab more of your money from this new source.

Should the Internet be totally free of taxes?

Or maybe, as one friend suggested, we should stop all other taxes and just tax the Internet. It’s the future of the economy, so why not just switch all taxes online and let those not participating in the online economy get a break for one? Weird thought. It’s going to take some very creative thinking to handle taxing the Internet.

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  1. robojiannis
    Posted December 22, 2007 at 5:55 am | Permalink

    The Beatles: “If you take a walk, I’ll tax your feet; ’cause I’m the taxman”
    One more way (and very harsh one) for organizations to regulate the internet.

  2. Posted December 22, 2007 at 9:59 am | Permalink

    Um. This confuses me. I am not making any money on the web at present, and just assumed that if I did, I would report it to the IRS and pay income taxes on it, like I pay taxes on the money I earn at my real (meaning physically at a restaurant and cooking) job. Are they wanting to levy an ADDITIONAL tax on internet income? More information, please!

  3. Posted December 22, 2007 at 10:30 am | Permalink

    Maybe they could tax it like some countries do by putting a levy on blank CDs, DVDs, cassette tapes etc, and distributing the money back to artists for copied works. Computers would come with an Internet tax. The money would go to WordPress bloggers. I like that idea. 🙂

  4. Posted December 22, 2007 at 11:16 am | Permalink

    In theory Belgium bloggers with AdSense ads on their blogs should officially register as freelancers and pay the according taxes. But as taxes are paid according to results and not directly related to income only pro-bloggers making a lot of money will pay taxes in practice. (source in Dutch).

  5. Posted December 22, 2007 at 11:52 am | Permalink

    @ robojiannis:

    I’m not sure if the taxes proposed for Internet services and access are to regulate, which implies control, as much as they are to put their hand out to catch money from every and any angle they can. Where there is money to be made, government wants a piece of your pie.

    Janice: If you make income, and live in a place which as income tax, the income you make from anything, include the web, “must” be reported and taxes paid upon it. It doesn’t matter the source, though there are tax write-offs and variations on the tax rate depending upon the source – it still can get taxed.

    Sales tax is put on things you buy, and there are taxes on telephones, television, cable, and other services to pay for whatever they think they are paying for within your community or government. A tax on access to the Internet is what they are talking about, but this could easily grow to cover taxes on web hosting and other paid online services.

    If taxes are put on web hosting, then what happens to free web hosts? Would they have to start charging something for allowing you to blog on their site? Sure, they make money through advertising, etc., for you blogging for free, and they pay taxes on that, but what about you? Should you pay a tax for having a free blog on a free web host to balance out those who pay taxes for self-hosting?

    If you have a self-hosted blog, and you don’t make money with it, then the only tax you would pay would be in the hosting fee. If you make money, you pay the hosting fee tax plus the income tax. Is that double taxation? Nope. You have a choice.

    Governments want in on the big bucks the web and blogging is supposedly making. They’ll stick their hand into any money bag they can find. Wouldn’t you? Free money! Everyone else does the work and all the government does is collect and spend. 😉

    We’ve been riding a wave of illusion that everything on the web is free. It started out as a lovely idea, and for all intents and purposes, it should remain so, but that’s not the kind of world that we really live in. Greed continues to rule.

    You want the web to be free, but you also want the web to pay you. Somewhere, the government will stick their hand in. Where is up to you, your big mouth, and your vote.

  6. Posted December 22, 2007 at 3:58 pm | Permalink

    Internet taxation is inevitable. What we got was another 7-year delay on it. Why do I say this? Because the FCC has been considering taxing a chunk of the USF and using it to deploy broadband to rural and underserved areas. Sooner or later, next-generation data systems will come under the tax in order to “pay their fair share” (which is telco-speak for “be run out of business”).

    It’s also worth noting that cable and phone systems are largely all becoming data systems. Who’s to say that a creative FCC can’t decide that the shiny new systems built on the 700MHz spectrum are considered video or phone systems and level appropriate taxes? While our libertine sensibilities ruffle up at the mention of new taxation, we should be prepared for what we all know will be coming down the pike. It’s already started.

  7. Posted December 23, 2007 at 8:16 am | Permalink

    Yikes. I have free hosting, at present, but my host is in Belgium. Who knows what will happen? I suppose I’ll just have to open up my big mouth and write to my Congressperson. By email and on actual paper 🙂

  8. Posted December 23, 2007 at 9:55 am | Permalink

    Important topic and I think your correct Lorelle “ya can have your cake and eat it,” but Mrs. Fields will be asking for her cut…errr….or Mr…errr…Uncle Sam that is…..


  9. Posted December 23, 2007 at 2:08 pm | Permalink

    Oha, a very difficult topic.

  10. Posted December 23, 2007 at 9:04 pm | Permalink

    I think that it’s fair enough for those of us (including myself) who make money on the internet to pay tax on that income, but taxes shouldn’t be levied on activities that don’t result in income. I don’t think that it is reasonable to expect merchants to be expected to make sales tax payments to the jurisdictions where their customers reside. And I think that it’s a remarkably bad idea to charge users for use of the data transmission infrastructure – like the telecommunication companies have been lobbying for. We build roads and other infrastructure as societal investments in commerce – we all pay for it so that we can all enjoy the benefits. The Internet is no different.

    Everyone (including myself) rails against taxation and government spending / waste, but without the taxation that it takes to develop and maintain infrastructure what you get is usually referred to as an underdeveloped country. And you don’t really see much opportunity for anyone in those places.

  11. Posted December 24, 2007 at 1:54 am | Permalink

    The Internet is mostly used as a source of information and recreation so it’s more like a big library and playground. Also, the shopping sites should be free to visit, just like high street stores. So I think the only tax should be on business profits like it already is.

  12. Posted December 24, 2007 at 10:20 am | Permalink

    @ Andy:

    The Internet is mostly used as a communications tool and outlet. More bandwidth – legitimate bandwidth – is used by email and communications than other media. Which can include blogs. As a library, it’s not there yet, but improving. As a playground – when the bandwidth speeds and capabilities improve, then the gaming will definitely improve.

  13. Posted December 25, 2007 at 7:17 am | Permalink

    I agree with David who said “I think that it’s fair enough for those of us (including myself) who make money on the internet to pay tax on that income, but taxes shouldn’t be levied on activities that don’t result in income.“.

    Makes sense to me. I don’t see why working on the Internet and making an income from it would not be taxed in places that require income-tax. t’s the same as working at a “normal” job.

  14. Posted December 27, 2007 at 2:06 pm | Permalink

    Lorelle, anything that is taxed, is controlled by those who tax it.

    I find it ironically funny — well disgusting actually — that those who are left-leaning — bay area types aka coders, sys admins, redmond types — suddenly are opposed to taxes when it’s their ox being gored.

    How can we pay for all those Social programs if we don’t tax? Choices, they do so suck sometimes.

  15. Posted December 29, 2007 at 5:09 am | Permalink

    Well, firstly, we have to report our earnings online and pay taxes on it – so, it is just the same as any other businessmen. if they were to introduce internet tax, that is just the same as saying “Please don’t use the internet”. We have paid bills to access online (and taxes for the service too), why the heck are we suppose to pay internet taxes?

    Sheeesh.. this is what u get when u have greedy government..

  16. Brielle
    Posted May 3, 2013 at 8:54 am | Permalink

    Very Interesting information. I never thought about how one day someone could be taxing us to use our blogs. I was just doing research on how to do taxes online for my Finance class’ final. I am glad I came across your article. It was very informational.

    • Posted May 3, 2013 at 4:06 pm | Permalink

      Thank you.

      If you make income from your blog, as it states in the article, you are liable to report that income and pay taxes upon it, as you would with income from any job. People sometimes forget that. With the changes in sales tax for online purchases looking like an escape route for many countries and states to make “free” money, everyone paying their part might help keep sales tax on web purchases from happening, or keep them small. I think it’s outrageous as we all pay so much in taxes already, so everyone is lucky that I’m not in government. 😀

4 Trackbacks/Pingbacks

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