No New Taxes . Aaron Lukas Aaron Lukas is an analyst at the Cato Institute's Center for Trade Policy Studies and member of the Advisory Commission on Electronic Commerce panel of experts. But at a recent meeting of the Advisory Commission on Electronic Commerce in New York, Gov. Michael Leavitt of Utah proved that he's in the same league. No, what it means is no new taxes being imposed on sales over the Internet. Of course, the use tax is virtually unknown to ordinary taxpayers because no state has ever made a serious effort to collect it.
States hate collecting taxes directly, so they delegate the task to businesses.
But under federal law and the Constitution, a state is prohibited from forcing wholly out of state sellers to collect the state's taxes. That's why Governor Leavitt, the unofficial leader of the Advisory Commission's pro-tax faction, wants Congress to change the rules. If he has his way, an antique shop in Maine would have to collect and remit taxes to Salt Lake City for all its sales in Utah. The difference is, of course, meaningless. But there's nothing fair about exporting taxes.