Can Washington Charge Unauthorized Downloaders With Tax Evasion?

from the it-worked-for-al-capone dept

A bunch of states have been pushing forward with plans to add taxes on digital downloads. The state of Washington apparently passed just such a law, which is scheduled to go into effect on July 26th. Nate sent in a note, pointing out that under a strict reading of the details of the bill you could see how the state could go after unauthorized downloaders as "tax evaders." Now, that may not be the case (and it would be great if we could get someone from the state to clarify), but it seems that what Nate is likely referring to is this explanation in the Q&A about the bill:

What is the value of the digital product for use tax purposes?

The value is the purchase price of the digital product. If the digital product is acquired by means other than a purchase, the value of the digital product is determined by the retail selling price of a similar digital product.

From that, you could easily conclude that anyone in Washington who downloads unauthorized files is now expected to pay a tax based on the "retail selling price" of the files. And, from there, it's not hard to see how failing to pay such a tax, could eventually be seen as tax evasion. How excited do you think that makes the RIAA? Remember, this is the same RIAA that suggested that the feds use copyright infringement laws to arrest drug dealers. You can check out the specific text (in Section 304) within the full bill (pdf file), which is basically the same as what's written above.

The feds eventually went after Al Capone on tax evasion charges. Are file sharers next?

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Washington State Sues Company For Fake Error Messages

from the that-old-scam? dept

For years, questionable "software" firms would buy up ads that pretended to look like computer warning messages telling you that your computer was at risk. Then there were scamming companies that would include a web-based "test" of your computer to see if it was at risk -- and, of course, it always found that you were. The scam is just to get you to download (and buy) their software which rarely does anything (and most of the time you don't need it). The FTC had cracked down on these companies a while back, but it appears at least some are still in business. Washington state is now suing a software company that apparently did something similar sending messages to computer users claiming "CRITICAL ERROR!" and demanding that they download the company's product immediately to repair the problem. Of course, there was almost never an actual problem... but the software cost $40.

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