Save the children, tax the Internet!

June 8, 2009 by Valerie Helmbreck

Posted in: Compliance, cybercrime, e-commerce, Hardware, Software, Special Report, Web sites

web-security

Louisiana lawmakers have a reputation for their “creative use” of taxpayer money. And now they’ve come up with a way to get their hands on more of it — under the dubious guise of “Saving the Children.”

The new tax: a 15 cent surcharge on everybody’s Internet bill.

Doesn’t sound like much to save all those kids, does it?

The idea, according to backers of the bill that just passed the Louisiana House, is that the money raised would be used to fight “cybercrime.”

And who are the most innocent victims of cybercrime? Why kids of course!

According to an Associated Press account of the bill’s passage, Rep. Mack “Bodi” White, R-Denham Springs, said he sponsored the bill for Attorney General Buddy Caldwell, to raise money to finance a division in Caldwell’s office that investigates Internet crimes, particularly online sex crimes against children.

The measure would raise $2.4 million a year for Caldwell’s department, according to a financial analysis.

“I don’t think that 15 cents per month is too much to ask for our children’s protection,” said Rep. Simone Champagne, D-Jeanerette.

While White called it a usage fee, opponents called the charge a tax on Internet access. They’ve questioned whether it violates a federal law prohibiting states from taxing Internet services and would be challenged in court.

It’s also yet to be explained how this “usage fee” would impact businesses. Would each company computer with Web access be assessed the fee?

And why should cybercrime be granted additional funds when there are plenty of other criminal investigative teams out there that would have to go begging for resources?

As one lawmaker quipped: “I don’t think we should start instituting a revenue stream for every criminal element that’s out there.”

The charge on Internet access would begin in 2010, charged to users on their monthly bill. Public libraries and public schools would be exempt. The dollars would flow into an “Internet Crimes Investigation Fund” for Caldwell’s office to investigate online sex crimes, online child pornography and Internet fraud schemes.

But all the conversation on the House floor centered on sex crimes against children.

Of course it did. Why talk about identity and data theft from adults and corporations (who couldn’t get protection from the rain these days) when you can talk about sex crimes against children.

Who exactly is gonna vote against protecting children from sex crimes? And let’s just imagine their re-election campaign if they do.

Of course, all this puts smooth-talking Gov. Bobby Jindal in something of a pickle. He’s a big law and order guy who rails about criminals and how we need to get tough on them.

But he’s also an avowed no-new-taxes guy as well. Which puts him squarely in the category of “We Must Have Government Services But I’m Not Going To Pay for Them.”

Good luck with that, Bobby.

The bill now heads next to the Senate for debate.

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Tags: Gov. Bobby Jindal, House, Internet, Louisiana, senate, tax, usage fee

Nanette Pearson

I am offended by the smart aleck tone you take with this story. News is news but you are presenting a very slanted position that has me considering dropping your feed. I could spend my time retorting your slant, but won’t bother, anyone with an analytical and fair mind can see there are many pros and cons to this idea that you don’t begin to touch on, focusing instead on the easy slam.
http://www.financetechnews.com Valerie Helmbreck

Nanette: I’m sorry you were offended. That wasn’t intended, but I can see your point. However, I think it’s worth remarking on that cybersecurity is a wide and dangerous activity. That the Louisiana legislators are focusing only on its more salacious aspects to get their bill passed is, to my mind, disingenuous. The theft of identity, company secrets and data is far more prevalent than child abuse on the internet and and these other crimes also have a huge cost. But instead of discussing these rather dry topics, legislators are using the public’s fascination with sexual deviance to sell their bill. I also believe that it is dangerous to segregate funds for criminal prosecution by creating revenue streams for them. If a crime is serious enough to be prosecuted by law enforcement, it should be supported by public funds. The industry that the criminals use to pursue their life of crime shouldn’t be taxed to pay for the behavior of the miscreants. If I took a mocking tone, it was for these reasons. I regret you were offended. My tone was intended to provoke discussion, not end it. I appreciate your feedback and reaction to what was written. Thanks for expressing your opinion.
JLatham

Valerie, I’ll come to your defense. While I agree with Nanette that the tone could be misconstrued, but it is almost exactly the tone I would have used.
This is either a well thought out, or very poorly planned “tax”, I suspect the latter because to think the first would be to begin to join the conspiracy theorists of the world. Consider the very nature of the internet. It is inter-STATE and inter-NATIONAL, and pretty much no way is the Great State of Louisianna going to be able to police much of anyone outside of their boundaries. Surely they already have sufficient funds to police their own boundaries, and a specified budget for their cybercrimes department? I’d have put more credence into the effort if they had levied it with the intent of moving the funds to their education system; probably much better return on their investment and the tax-payer’s dollar.
Actually the best policing of the internet is probably done by PARENTS – be aware of where your children are surfing, who they’re meeting up with in MySpace, what they’re twittering about today, and in general being a guardian of their children. I’ve always felt that it was a parent’s job to raise and protect their children, not the state’s. I’m also of the opinion that the one change to the internet that keeps getting shot down is the establishment of a XXX domain so that “reputable” adult content providers can easily identify themselves so that parents can put locks and safeguards in place on their computers to prevent exposure if so desired by the parent. And, no I am not so naive as to think that the unscrupulous would identify themselves as such, but when was the last time we actually saw any criminal running around in a custom made t-shirt with “HI! Your friendly neighborhood thief/burglar/rapist – remember my face” boldly emblazened on it.
Brian Edwards

I wholeheartedly agree with your email Valerie – Please don’t apologize for the tone or verbiage. There have been numerous dubious laws and taxes passed with an ad-hominem “Save the [insert exploited group here]” argument that has little to do with how funds will be disbursed; let alone their legality. Am I ambivalent about child port? A resounding ‘No’! Does this bill appear to be a just another way to squeeze more money into a governmental black hole? A resounding ‘Yes’!
This would certainly seem to fly in the face of the federal ruling regarding Internet taxation by state governments. I would also agree that this is not taxing an industry that sexual deviants use for their benefit; but creating a revenue stream for a specific type of crime. As you mentioned; the far more widespread problems of identity and data theft are left out, as it is far easier to stir up emotions and outrage when a bill is tagged with such a universally despicable crime as child exploitation.
Please keep up the good work.
paul schultz

I’d like to see you do story on the abuse of sales taxes by states. Here in PA our customers have to pay 6% sales tax on their purchase AND the shipping cost we charge them. As far as I know PA is the only state that charges sales tax on shipping charges. Shipping charges are way too high as it is but to tack on sales tax makes it even harder for us to compete with other mailorder retailers in states where shipping is NOT taxed. Thankfully PA does have one of the lowest sales tax rates in the country. It has not changed in 30-40 years. I’d like to see a article which shows the sales tax rates for each state and what is taxable. Thanks.
Lisa

With the XXX domain perhaps our Porn-nation would then be able to tax that to death. Seems it (porn)is more addictive for those people than any drug / alcohol / substance. Contact your reps and lets see what can be done. Perhaps even tax on the amount of time spent on those type of sites$$$$

“If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.” II Chronicles 7:14
terrie j

Geez, this just touched a nerve…

I am sick to death of tax increases on specific products/services to fund any/all specific causes. If the government can’t pay for services, they should (a) eliminate the service (b) eliminate another less necessary service or, as a last resort, (c) increase the general tax rate. It’s called budgeting, and it’s something all we average working people have to do on a daily basis.

I’m fed up with zeroing in on homeowners, tourists, vehicle owners, telephone users, smokers, drinkers etc – and I’m dead against stuffing a general expense down the throats of a particular industry or consumer. Ever notice how the ones doing the stuffing are rarely the ones that have to do the swallowing?

If a program is important enough to warrant a tax increase, then everyone should foot the bill for it. It’s way too easy for governments to institute tax increases when they can convince voters that someone else will have to pay for it.
JParr

As is typical, the people making these decisions are people who are clueless about what they are affecting or how “the internet” works.

It sounds good on paper, so lets do it. No consideration for the administrative costs, impact to free speach, specific allocation of funds (if there is surplus money, where does THAT go!), etc…

Plus, although constitutionally chartered to enact taxes for (one of) the purpose of affecting behavior, enacting this law implies that there is a linkage between internet usage and child exploitation that just does NOT exist.

This is like the Texas law, being examined in the courts now, that takes a $5 surcharge on strip club admission fees and allocates it to a fund for battered women. I’m NOT FOR the strip clubs NOR AGAINST the battered women, but this type of tax is lunacy, for the reasons mentioned above.

While we’re at it….

Let’s tax Sushi joints and give the money to hospitals because people MIGHT get sick eating sushi.

Let’s tax shoes and give the money to violent crime victims because people who buy shoes MIGHT rob or hurt people.

Let’s tax tires because people who buy tires drive cars, and anyone who drives a car MIGHT rob a bank.

It’s rediculous.

IF you’re going down that road, let’s tax MySpace and Facebook, whose FREE facilities bring predator and prey in to dangerous proximity….. If you have to have Mommy and Daddy pay by credit card to sign up for a Facebook account, YOU MIGHT NOT DO IT without their permission! Or how about a mandatory “computer-based training” module on how to avoid cybercrimes as part of signing up for these “free” websites?

It’s sickeningly amusing how the inept are always ready to lead the charge.
RWA

The necessity of this depends on a few things. What is currently in place? It doesn’t sound like the division of the department is up. It also sounds like the money would be going to more areas of cybercrime than just sex crimes against children. What can the money help the department do that is not currently being done? And most importantly, what is the cost-analysis of such fund? Sure, it’ll cost each internet access bill an addition 15 cents and 2.4 million across the state, but what could the return be by such internet crackdowns? How many identities could be saved? Frauds sought out in the area and pursued. And most importantly, does this have the potential to save lives? If they can show that, at least pretty likely, that the money will be well used with a good return, go for it.
Dan

Valerie: Your points were well taken and the tone was right on! It’s analogous to politicians always invoking the threat of cutting of “essential” public servies anytime there is a budget shortfall. It grabs headlines. If Bobby Jindal is smart, he’ll cut somewhere else to fund this if he thinks it’s worthwhile and he’d better have a PR campaign in place if he does. Sure, $.15 is really nothing but it’s the point. It’ll be $1 before we know it, then $2…People are fed up with higher taxes. I think we are at a tipping point where the politicians are going to wake the sleeping giant and the electorate reigns in the government by throwing them all out.
Tracy

To follow-up on JParr…

I live in a state that charges a personal property tax on cars. What’s next – personal property tax on my shoes, clothes, jewelry, cell phone, computer and my furniture!!! I thought I already paid taxes when I bought my car – why I do have to keep paying taxes year after year for something I already paid tax on!!! WHY???
Michael

It’s like she said in the story: who is going to vote AGAINST this legislation? They will be tarred and feathered for doing so. 2.4 million dollars is a drop in the bucket in todays world… but … you can bet the tax will go up in years to come…. not down… or away!
doug d

Politicians are criminals. The money collected from this type of tax will never be used to “save the children”. It will pay for someone’s ski trip to Vale.
http://www.financetechnews.com Valerie Helmbreck

Good point Michael, 15 cents sounds like nothing right now, but what’s to stop them from hiking it in months/years to com? Once a tax is put in place, it’s hard to dislodge. And as more and more critical services have to be managed from the Web, Internet access isn’t the luxury many may think it is. It’s becoming as necessary as water and electricity. To tax essential services is ultimately a tax on the poor; the rich can well afford it, but those who live on the margins will wind up getting pushed out. I believe the Internet needs to be more accessible, not less. And levying a tax — any size tax — does nothing to help that.
Mike NoTax

NO NEW TAXES PERIOD!!! Stand up and fight people. When we let politicians use us as their own personal ATM machines whenever they can’t foot the bill for their own personal pet projects then we as Americans are suckers. We can’t continue to let senators and politicians tax us to our death. There are literally thousands of other taxes that get paid each and every day and it’s time WE put a stop to it. Forget what their for. Even under the guise of protecting children, this is still yet another way for government to tax us even further. In Michigan tobacco taces just increased to help fund hospitals. Can you believe that. It’s not bad enough the hospitals and insurance companies make people bankrupt, but now the state is literally giving them our hard earned money. STOP SPENDING WHAT YOU DON’T HAVE. If i don’t have the money to get that flat screen T.V., I won’t buy it. Simple right?
T. Robert

Great post Lisa!

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