However, most discussions of e-commerce miss a much larger issue. Consumers are not the only beneficiaries of the Internet. State and local governments can also benefit, saving billions of dollars through electronic government. The savings generated by shifting some services to the Internet will be more than enough to offset any minuscule losses of sales tax. According to IBM's Institute for Electronic Government, early studies indicate governments are saving up to 70 percent of the cost of providing services by moving them on-line.
Citizens benefit by moving from standing in line to going on-line.
Arizona and IBM recently implemented an on-line vehicle registration program, ServiceArizona. Governments are also saving money through on-line purchasing. Governments have barely scratched the surface of e-commerce. Only 1 percent to 10 percent of government services are available on-line, yet government agencies are already saving millions of dollars. Not only should governments avoid restraining e-commerce, they should rejoice in the efficiencies it brings.