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Ted Cruz warns against lame-duck passage of Internet sales tax

At first glance, I thought this video from Senator Ted Cruz (R-TX) concerned President Obama’s Net Neutrality push.  While Senator Cruz has been outspoken about Net Neutrality, in this case he’s warning about dethroned Democrats forcing a different bad idea through Congress during the lame-duck session: a sales tax on Internet purchases.

I’ve been on the No Net Tax bandwagon for a long time, in no small part because of the problem Cruz mentions in this video: the crushing accounting, reporting, and auditing requirements that would be dropped on countless online retailers of modest size.  The big brick-and-mortar corporations can easily handle a Net Tax for their online sales operations – they already have that infrastructure in place, if they’re running stores in most or all of the fifty states.  Cruz is exactly right: the Net Tax would be a sandbag thrown into the chests of smaller competitors.  This sort of anti-competitive leverage is one of the reasons Big Business, contrary to its popular image of bankrolling Republican politicians to keep noble regulators off its back, is actually quite amenable to hyper-regulation.

Cruz tied the Net Tax, Net Neutrality, the battle to preserve free online speech against the Stop Online Piracy Act, and even the Obama Administration’s desire to hand over Internet domain regulation to some nebulous international body, together in a Washington Post op-ed:

We don’t leave our constitutional rights behind when we go online. The same commitment to the principles of liberty that made the United States the greatest economic superpower that the world has ever seen must prevail in the virtual world as well.

We should keep the federal government out of the business of regulating the Internet. The United States has always been a place where someone with nothing can achieve anything. Freedom allows that social mobility, and the Internet is a haven for that entrepreneurial freedom.

Call it the American Dream 2.0.

We really don’t spend enough time contemplating the Internet revolution as an astounding example of the growth that is possible when the government’s taxing and regulatory boots are kept off our necks.

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