Internet tax proposal

Alexander 'Sasha' Chislenko (
Sun, 13 Sep 1998 14:55:20 -0400

I just read the following on Educom:

WHITE HOUSE MULLS NEW INTERNET TAX PROPOSAL Ira Magaziner, President Clinton's senior Internet advisor, has proposed a new plan for tracking and taxing goods sold over the Internet that would use electronic "resident cards" and private-sector escrow agents around the world. Consumers would obtain digital cash at banks that would allow merchants to identify which country the buyer is in, but would reveal no other personal information. Consumption taxes would then be calculated, collected, and placed with an escrow agent who would then funnel the money to the appropriate government. "Governments would get their money more quickly... they would get a higher compliance rate... and the system would be easier to police," says Mr. Magaziner. (Wall Street Journal 11 Sep 98)

I wonder how they would prevent Liberian residents from selling their digital cash at a slight premium to the residents of higher-tax countries. The whole scheme seems as likely to work as the infamous key-escrow proposals. Also, it's interesting, that though it is currently assumed that everybody should belong to one territorial taxing system, the [improved/voluntary] scheme could work for a vector of non-territorial collecting (or subsidizing) agencies, or perform other smart-money functions.

Alexander Chislenko <> <> <>

I'll be away from home at ISAS conference in D.C. from Sep. 13 to Sep. 22, and may take longer than usual responding to email.