Telecom Providers and eCommerce - Nothing is certain but Death and Taxes

The marvel of all history is the patience with which men and women submit to burdens unnecessarily laid upon them by their governments.

William E. Borah, Speech to the U.S. Senate

The recent spate of takeovers or crackdowns if you will, of websites involved in the distributing of copyright infringing content i.e. pirated movies, music, etc as well as the issuing of warrants of arrests for the principal masterminds involved in hosting these sites and the bank accounts holding their ill-gotten gains as stated in the article “Feds sieze cash, Web sites of alledged film pirates”, published June 30, 2010 3:11 PM PDT by Greg Sandoval CNET News - Media Maverick.

The subsequent disclosure that Congress is going after Colleges and Universities to make them culpable for the sins of it student population as it relates to the downloading of said copyright infringing content as stated in the article “Federal rules on campus file sharing kick in today”, published July 1, 2010 7:14 AM PDT by Greg Sandoval CNET News - Media Maverick, may seem to be another attempt to snuff out innovation and the can-do spirit of Colleges and Universities, but it has more business-like motive.

It appears that this is part of the Government of the United States of America’s plan, similar to the Government of Jamaica’s plan based on the Matalon Report, to raise additional taxes, this time from the taxing of business transactions on the Internet.

This is the implementation of a State Sales Tax for Internet and mail-order purchases, similar to those already paid by Brick-and-mortar companies as stated in the article “Democrats push for new Internet sales taxes”, published July 2, 2010 12:28 PM PDT by Declan McCullagh, CNET News  - Politics and Law.

Yep. Indeed, never were the words of Benjamin Franklin more potent: Nothing is certain except death and taxes!

This groundbreaking soon-to-be-implemented piece of legislation is no coincidence as it comes on the heels of declarations by the Government of the United States of America to allow Online Gambling so that it can be taxed as stated in the article “Congress may roll dice, legalizing Net Gambling” published May 18, 2010 11:14 PM PDT by Declan McCullagh CNET News  - Politics and Law.

A similar decision by the French to open up their Gaming and Lottery Industry to Online Gambling as stated in the article “France opens its markets to online gaming”, published Tuesday June 8, 12:03 pm ET by AFP, Yahoo! News, PARIS, ostensibly for the purpose of increasing tax revenues.

The earlier decisions were being championed by Rep. Barney Frank (D-Mass.) in a bill titled H.R. 2267, would allow Internet casinos to obtain licenses from and be regulated by the Federal Government. Combined with the H.R. 2268, which would  impose a 2% federal “Internet Gambling fee” and require that the IRS be notified of taxpayers' winnings and H.R. 4976.

This would allow the State Government to impose a 6% Gambling tax, the Government of the United States of America stands to collect fifty eight billion (US$58,000,000,000) dollars in tax revenue by the year 2015 and create thirty two thousand (32,000) jobs in the process based on a study done by the H2 Gambling Capital, a gaming consultancy.

However, it is the arguments of Michelle Minton, a policy analyst at the free-market Competitive Enterprise Institute, who states that “the fundamental issue is consumer choice - it is not the place of Government to tell adult citizens what activities they can and cannot engage in from the privacy of their own homes”, that carries weight as pointed out in my blog article entitled “MNP, Supreme Ventures Limited, internet Gambling and the Royal Flush of Smart phones”.

Thus these recent actions as it relates to the shutting down of websites that provide access to students of these Colleges and Universities to download said copyright infringing content and now forcing Colleges and Universities to police and stop the illegal downloading of copyright infringing content.

This was championed by the RIAA (Recording Industry Artiste Association) and the MPAA (Motion Picture Artiste Association) and supported by Congress, with consequence of suspended Title IV Federal Aid to Universities and Colleges in the United States of America in breach of the Higher Education Opportunity Act (HEOA) of 2008 begin to make sense

By legitimizing the online purchasing of such content, it would increase taxable revenues, as the only way to get movies and music online is to either subscribe to the service, as in the case of Hulu and its sweet US$10.00 per month streaming deal as stated in the article “Hulu launches $10 video subscription service”, published Tuesday June 29 2010 by RYAN NAKASHIMA, AP Business Writer, Yahoo! News and Skype as stated in the article “Skype for iPhone now support 3G, but free ride's ending”, published June 2 2010, by Ben Patterson, Yahoo! News.

Even the recent granting of the .xxx domain to the purveyors of pornographic material by ICANN (Internet Consortium on Assigned Names and Numbers) as stated in the video CNET Loaded aired Monday 28^th June 2010 by Natalie Del Conte, Senior Editor, CNET News and confirmed in the BBC (British Broadcasting Corporation) article “Sex domain gets official approval”, published Friday June 25 2010 by BBC World, which legitimizes the online commerce in nude images and pornography is being seen as a source of taxes from previously tax-free online purchases.

The champions of this overarching grab for taxes is the Democrats, specifically Bill Delahunt and his band of Merry Men (Hollywood, how does that title for my movie sound?) inclusive of his Democratic co-conspirators in the form of Michael Capuano, John Conyers, Stephanie Herseth Sandlin, and Peter Welch, with not a single Republican in sight, odd as they love money and taxing the poor more than the Democrats.

The Bill, colloquially titled the “Main Street Fairness Act”, if enacted would effectively make all Credit Card purchases, even via PayPal, taxable, thus raising an additional twenty three billion dollars (US$23,000,000) in new taxes, effectively ending the halcyon days and reverie of “outsmarting the Man” as the Americans would say by making their purchases online.

This is hardly a new debate, whether in the United States of America or in Jamaica, as taxing transactions over the Internet is also on the cards for Jamaica, as Prime Minister Bruce Golding of the Government of Jamaica recently passed a CyberCrime Bill aimed at making the Internet a safer place for Jamaicans to do business as stated in the article “Move to Tackle CyberCrime - Hacker got Golding”, published Sunday  February 14, 2010 by Philip Hamilton, Gleaner Writer, The Jamaica Gleaner.

Government of Jamaica has also begun work on the Credit Reporting Bill that Governor of the Bank of Jamaica, Mr. Brian Wynter, hinted at as being relevant to growth as stated in the article “Credit Rating buearu needed quickly - Wynter”, published Friday January 22 2010, by Alicia Roache, The Jamaica Observer.

In reality it is really more significant to the development of eCommerce, as we already have an Electronic Transactions Act and Mobile Banking is now on the radar, as the Big Three (3) in Banking, namely RBTT (Royal Bank of Trinidad and Tobago), NCB (National Commercial Bank) and BNS (Bank of Nova Scotia) are pushing Mobile Banking using Telecom Provider’s and their smart phones as the Platform upon which customers of these banking institutions can conduct their financial transactions.

It is customer interest that is driving the push towards mobile banking as stated in the article “Customers spur bank competition online”, published Friday, June 25, 2010 By Alicia Roache, The Jamaica Observer.

With the just concluded JDX (Jamaica Debt Exchange) as stated in the article “JDX ends at 99 per cent; Minister says thanks”, published Thursday, February 25, 2010, The Jamaica Observer, its inherently lowering of Interest Rate Spreads is forcing investors to scramble for cover and the safe haven on investments and businesses that are earning foreign exchange revenue.

This is in light of rumblings of a coming Double Dip Recession rumored to be occurring in Europe due to sporadic reports of belt-tightening and self imposed austerity measures in an aim to cut back on waste in terms of Government spending on Social Services that are being considered as luxuries and programs that are not relevant to growth.

Coupled with Oil, this is a prediction that had been previously echoed by Dennis Chung, but predicted to occur in the United States of America for reasons related to lack of investment in actual growth areas such as eCommerce, Agriculture, Export Manufacturing via pursuing the lowering of the cost of Electricity and diversification of their Energy Sector away from Fossil Fuels as stated in the article “RISK OF A DOUBLE-DIP RECESSION?” published Friday, September 18, 2009, by Dennis Chung, The Jamaica Observer.

Thus, these measures by the Government of the United States of America to raise additional sources of Foreign Exchange Revenue directly related to trade via closing the Taxation Net in on Internet Transactions is much the same recommendation for the Jamaican Economy by the Matalon Report.

The Government of the United States of America now are in effect laying this burden on the backs of American taxpayers via the taxation of their luxuries and penchant for gambling and the perusal of sexually explicit content via the Internet………..and no, John Public in Jamaica had no hand in this, as nothing is certain but Death and Taxes.