Danny Newton

The Amazon Tax on e-Commerce: Coming Soon to a State Near You

States "need" the money to chase after federal matching money for stuff they would not buy if the purchase involved 100% of their own money. This, of course, will neutralize the effect of a tax cut at the federal level by lowering disposable income. The loss of disposable income is harmless if the service provided by the government with the new money offers some kind of public benefit that offsets the wealth transfer to the government. That benefit could simply be increased productivity. So far, I can remember only two examples in my life time of this happening. One would be rural electrification and the other would be the construction of the Interstate. Nothing that the federal government currently proposes has a chance of doing one-tenth as much good.