Connecticut Senate Bill Aims to Tax Your Video Games and More

March 14, 2012 -

The Connecticut State Senate is considering a bill that would add taxes to digital goods. The "stated purpose of the bill, is "to include digital movies, books, music, ringtones, audio and video works and similar downloadable products as subject to the sales and use tax." If passed, the bill would take effect July 1, 2012, and would apply to sales occurring on or after that date.

You can read the bill at cga.ct.gov (PDF). The next senate hearing on Senate Bill 400 will take place March 16, but you can certainly let lawmakers in Connecticut know how you feel about it thanks to a new action alert from the ECA. Their appeal for your support can be found below, but if you want to jump in and help immediately, visit this page now.

Tell the Connecticut Senate to not tax our hobby!

Connecticut gamers, take a moment to tell your representative not to tax our hobby! Senate Bill 400 would implement a tax on digital downloads and would make it more expensive to enjoy video games. Let the Connecticut legislature know that this is not the right way to aid an economic recovery, and not the way to represent their constituents. Please read the letter below, plug in your contact information to the right, and feel free to add you own thoughts to show your opposition to SB 400.

Update: The ECA provided the following comment on SB 400:

"Connecticut Senate Bill 400's proposed tax on digitally downloaded content is onerous and counterproductive," said Jennifer Mercurio, Vice President & General Counsel of the Entertainment Consumers Association, which is based in Connecticut. "It would raise prices, suppress consumption, and cause layoffs. We urge all Connecticut voters to ask their State Senators to vote NO on SB 400."

[Full Disclosure: GamePolitics is an ECA publication.]


Comments

Re: Connecticut Senate Bill Aims to Tax Your Video Games and ...

I guess they didn't hear about what happened in Oklahoma.

Re: Connecticut Senate Bill Aims to Tax Your Video Games and ...

This isn't a sin tax though. Oklahoma's proposed tax was a sin tax. This is a straight sales tax on items currently not covered by the sales tax. Doesn't make it much better, but at least they are applying across the board for digital goods.

Re: Connecticut Senate Bill Aims to Tax Your Video Games and ...

The problem I have with this is not so much on the idea of taxing internet purchases, but on State sovereignty. Does a state like Connecticut have the right to force an out of state company such as Valve or the Humble Bundle to collect its sales tax? I don't think so. 

I believe that something probably should be done to clarify sales tax law for internet purchases, but such a move can only be done by the Federal Government as it is the only entity in the US that has the right to manage interstate commerce.

Re: Connecticut Senate Bill Aims to Tax Your Video Games and ...

It's a matter of who has the burden of ensuring the tax is paid. If a game developer in Vermont sells a downloaded title to a resident of Vermont, the state can compel that developer to charge sales tax. If the developer is outside Vermont, the state can compel the buyer to pay use tax (which is, for purposes of this example, basically sales tax for out-of-state purchases). Since the use tax burden is on the buyer and not the seller, use taxes generally go uncollected and laws requiring their payment generally go unenforced.

Re: Connecticut Senate Bill Aims to Tax Your Video Games and ...

*nods* makes me wonder what the cost of implementing (and enforcing) such a system would be.

 
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