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California Lawmaker Wants To Change Law To Tax iTunes; Pretending Infinite Goods Are Tangible

from the reality-is-meaningless-if-it-gets-in-the-way-of-tax-revenue dept

Slashdot points us to the news that a Los Angeles (surprise, surprise) area politician is pushing to change a California law that requires sales tax on the sale of tangible goods. He wants the law to be adjusted such that digital goods would be considered tangible goods so they can be taxed. Effectively, this is a way of applying a sales tax on iTunes downloads as a way to make up the California budget shortfall. Considering that the entertainment industry has been trying to convince the world that intellectual property is no different than tangible property, it's not surprising that a politician coming from LA would see no problem with pretending infinite goods are tangible goods. However, it seems likely that such a plan would backfire. If anything, it will push more people to look for alternatives (potentially unauthorized) alternatives if California forces an unwanted price increase on iTunes. Also, if the law starts treating digital goods as tangible goods, will that give people other rights -- such as the right to do what they want with the content after purchase? It looks like there's plenty of opposition to this plan, so it probably won't go very far. In the meantime, though, does someone want to explain the difference between tangible goods and infinite goods to Assemblyman Charles Calderon?

Filed Under: california, charles calderon, digital goods, infinite goods, itunes, tangible goods, taxes


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  1. identicon
    jonnyq, 9 Apr 2008 @ 7:34am

    Re: Infinite Goods/Internet Tax

    So your entire point is that "infinite goods" aren't "infinite" but your only example of rebuttal is an unrelated quote about a different subject?

    If you want to say that something isn't "infinite" because the number "infinity" is never reaches - i.e. there are never "infinity" copies of an MP3, then fine, but you're missing the point. The point is that an MP3 can be copied (i.e. a new good created) at zero cost to the producer (because the copies are made by the consumers themselves, etc.) If you want to say that the bandwidth isn't free, then fine, but that's still not the point.

    Then you also "debunk" economic growth caused by free goods because you think that economic growth IS the proliferation of the free goods. That's incorrect. The economic growth comes when the free goods lead to greater sales of scarce goods such as tangible goods or services.

    You seem to misunderstand pretty much every facet of the concept.

    Someone posted a GREAT link about "12 ways to make money from infinite goods". It was a perfect textbook article, and I just can't find it again. I can't remember if Mike or Timothy linked it.

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