Over at DownloadSquad Peter White wrote on April 16th about a new law in consideration by the federal government - requiring online auction sites to report the Social Security numbers of their users. He raises a myriad of valid concerns about this, and I must agree - there are quite a number. But as I was pondering this difficulty I realized a simple way in which the federal and state government's could take a lot of the complexity out of sales tax collection - and also eliminate a lot of the gray market materials that go untaxed.

    I'm not sure about everyone else, but I don't think that it is necessarily that we absolutely want to go untaxed on these items (though many would admit it is quite the nice perk), rather it is simply that the methods of reporting these taxes is simply too complex. This has been one of the outstanding issues with mail order catalogs and the internet. Since the buyers and sellers don't have to be in geographical proximity to each other - who pays the sales tax? Technically, the purchaser pays the sales tax - but how many buyers actually remit their sales tax to the state? Not many. While states are attempting to revive these "use tax" laws they have thus far been largely unsuccessful. The number of people that are even aware that these laws exist is extremely minute.

    So, listen up governments (and tell me why this isn't a good idea). Instead of continuing to collect sales tax through these cumbersome manual methods, why not just tax my credit card? Every time I make a purchase lump on a sales tax and pay it out to the state in which my credit card is registered. It sure would simplify things a heck of a lot - it could even make sales tax collection easier for companies that are traditional brick and mortar - only requiring them to manually collect tax on purchases made by check or cash.

    I must admit, I think about these tax issues much more often than most people. Why? Because I have Obsessive-Compulsive Disorder and I am constantly afraid of stepping outside the bounds of the tax laws and breaking one. With the complexity of the tax system one can expect to have broken not just one but a dozen. For an OCD individual the stress of this knowledge is overwhelming. So, simply for those of us who have tax related OCD symptoms, the law should be changed. :-) ;-) Okay, so I'm working through my fears in this area - and even though my concerns may be partially inspired by unfounded fears over missing some pennies here or there (I've purposely overpaid my taxes at times to avoid this) - I think the recommendation is still valid. Simplify tax collection by automating it through credit card debiting. Its that simple.