Sneaky new internet tax pushing through fast

AFAIK tax on out of state purchase is illegal. Because of that my state (Illinois) collects "use tax" - different name of the same thing. Since I don't remember what I bought where I use option of paying fixed "use tax" proportional to gross income. I found this:

"What Are Use Taxes

As a general rule, a state's taxing power reaches only as far as its borders. What this means for sales tax purposes is that a state cannot impose its sales tax on retail sales that are consummated in other states. Because states can tax only transactions within their borders, there is a big loophole from the perspective of the State Department of Revenue. A state's residents could avoid paying a state's sales tax by making their purchases outside the state, either by crossing the border to an adjoining state or by making purchases via the Internet. To close this loophole, each state that has a sales tax also has a complementary "use" tax. The use tax applies to the "use, storage, or other consumption" within the state of tangible personal property, the purchase of which would have been subject to the sales tax had the transaction occurred within the state."

Under this current climate of corporations holding trillions off shore, using our infrastructure and paying nothing, one wonders if a tax increase to the people is an equitable solution.

That's the reason for deficit. Government spending adjusted for inflation is the lowest since WWII. Government "overspending" hysteria is propelled by the same people who lend money to government (Federal Reserve approved list) with government guaranteed interest. Average income tax comes to about 15% - please show me another country like that. Sure, there is additional tax on cigarettes, gas etc but every country has it even worse.

One can find one or two countries (like Switzerland) with lower tax rates but we are pretty much at the bottom. Look at this chart: http://www.economist.com/blogs/graphicdetail/2012/10/focus-4

Hifibri, you are right. I should've said spending increase instead of spending. I compared 1962 and 2013 spending itself, adjusted for inflation and population minus two fold increase in military spending (adjusted for inflation) and payment on the debt and came up with $8.4k per capita now to $2.4k per capita in 1962. I'm not sure what the reasons are but huge increase in spending took place during Bush years. Running two wars, returning taxes and creating largest government in history took toll. This largest government was due to Homeland Security - largest government agency ever. Homeland Security budget is $70 billion a year. It is best example of bureaucracy, having multiple agencies that don't know about each other, doing exactly the same. Another factor is 6% going for payments on the debt that started big with Reagan who created 3.7 Trillion Debt - equal to perhaps double that in todays money. Spending is too high but the worst thing one can do is to avoid paying (from tax increase) because somebody will pay it anyway, either we or our children (with interest). A lot of money go to welfare but so far nobody, republicans or democrats is interested in reforms. Current welfare law supports not working. Instead we oppose public healthcare or education that IMHO should not be business oriented.
Taxes are one of the lowest in the world but spread hysteria about being overtaxed causes very negative effects. Nobody wants to invest in any efficient long term program because it means being voted out of office. I remember discussion about Expressway reconstruction in Chicago area when they were not sure if it is worth to pay twice more for the road that lasts 4x longer. Any sensible person would say it is good deal (especially when they stand in traffic) but it was rejected. At the end we pay double because nobody wants to spend money now. We don't pay higher income tax percentage than before (I think) but big portion of tax revenue disappeared because of tax loopholes, companies going of shore and rich people keeping money in other countries. A lot of large corporations don't pay any tax at all.

Effective corporate tax rate in 1962 was about 40% but today is about 15% thanks to loopholes etc.

http://en.wikipedia.org/wiki/Income_tax_in_the_United_States

Audiozen, I'm not sure it would strengthen local stores. I would still buy over internet because it is better (not to mention I pay use tax anyway). I can get free shipping, read reviews and be sure it is in stock plus 10x better selection. In stores it is pretty much gamble. Even if I check on line store claims they are different entity. Driving thru stores that don't have what I want cost me time and gas money. In addition staff is poorly trained. When I asked for Toslink in Best Buy nobody knew what it was and took them about an hour to find it. Another time I called the store to make sure they have item but when I got there they couldn't find it because it was either misplaced or computer was wrong. Never again. Selection over internet is incredible while service from places like Amazon is just perfect.

Siddh, they might survive because of internet but store sales will be very weak unless they stop hiring cheap unskilled labor. When my nephew worked for Best Buy he was told to help undecided customers by saying "I have exactly the same one at home and it works great". Now I understand why they closed stores in Great Britain. Internet competition is strong especially when they have to compete with stores that specialize in particular item. It doesn't make difference to me weather store selling brand name computer memory sells anything else. Such competition lowers the prices and is good for customer. Borders Books did not understand importance of internet presence and is gone. Large items are still sold in stores but eventually everything will switch to internet.