Transcript
Hey everyone, welcome to another DailyJim it is friday july 8th 2022. Today I'm going to talk about how, I don't think we know how to govern in the day of the internet also the planes, but mostly the internet. So I think over the last gosh.
Easily 100 years with, I don't know how long cars have been out but about, 100 years maybe that they've been really growing in popularity I think as cars started to come into play and radio started to come into play, I think we saw, a dramatic increase in mobility of not only goods and things but also information.
And I think that accelerated as it went from, we had letters which were going by pony express in the US and then we started getting trains and cars and then in the US we got an interstate system which made it even easier to travel at high speeds. So there was a lot more shipping and then planes started to take off and planes got a lot cheaper to use. Um and so that was the increase in the speed and distance at which we could move things. But at the same time we're also having this increase in the speed and distance at which we could move information. So again, letters maybe to radio and phone calls, telegrams, things like this as it moved on. We started getting to people had phones, then they had cell phones to make phone calls, from car phones, you know, and then cell phones and then internet, you know, as internet was taking off computers, I had email and different online portals. But then when internet really combined with phones now information can travel very quickly now it's not just a phone and internet but then you get the cameras and you get video calls and the speed of the internet etc. Etc. So it seems like we've quickly changed how quickly and distantly we can interact with other human beings and things from other places.
And I don't know if our culture, but especially our law knows how to keep up with it. So this comes from kind of, it's a long way to talk about how I'm exploring different tax rates and yeah, different sales tax things as it relates to selling online goods. So if I'm here in michigan and I sell a digital good online, so I'm not shipping any, thing, a physical tangible thing, it's more shipping electrons really from one location to another.
I am supposed to collect sales tax or V. A. T. Based on where that person is when they buy it, not so much where I am, but where the customer is when they purchase it. And almost every place is a different kind of rule on how to guarantee this. From my understanding the Eu there's something like 27 different member States that all may have different V. A. T rates and there's like a minimum, but then they vary and then up until recently there was a threshold and they had different thresholds. And then if you look at the just the United States, there's 50 different states and varying sales sales tax rates across those. And it just gets really complex. And I tried to pull back and look at it from a kind of a philosophical level and go, okay, it doesn't really even make sense. Is this just some arbitrary tax that we've kind of created? So we need to charge, we need to make money for the government. So we're going to put it on top of when people interact and sell stuff and it made sense back in the day when people would sell things to each other. And the only way they could really do that was face to face. And the only way they could, you know, they didn't interact with people too far outside of their own region. So we would interact and selling the same under the same blah. But when we're in a place where we are interacting across geographic boundaries, which geographic law applies.
Should the michigan law apply? Should the german law apply if I sell something to somebody in California, which law applies, Is that michigan or California? Does it go to the U. S. Level? Does it go to a global level?
And so I am just exploring a little bit how it relates to sales tax and value added tax. But this also how does this relate to fraud? How does it relate to abortion? How does it relate to other things that are happening? Other laws that we have that vary from state to state or from country to country. And we don't really have a lot of um superseding laws that would be laws of the globe that are enforced. So a lot of times we have these conflicting laws and we don't necessarily have a process to go through like resolution process that we would within the US. If there's conflicting laws in the US often it will go all the way up to the Supreme Court to the highest court of the land of the american, you know, the United States land, and on a global level, we don't really have this at least not, well, we kind of have it when I think when it comes to nation to nation, but I don't know if individual claims can rise all the way up to the global level as a global Supreme Court. But regardless, just sitting back and trying to wonder how are we supposed to govern global challenges or challenges that cross nations and across geographic boundaries. When we don't have a global dispute resolution mechanism.
That's a lot of jargon just to say we do. People clash and we don't have somebody above us who tells us you know makes the final decision. What do we do? Maybe we just make up laws and pretend like everything is totally fine. Oh yeah just yeah you can just use whatever sales tax rate you want. Yeah. Well because you bought it here first we're going to try to make people pay. You know the customers are going to have to remit it. You know if if you paid anything if you bought anything out of state that had sales tax on it then you should take that you should submit it to the government. Well that didn't work. So maybe we could charge the out of state companies for selling to somebody in state. But that gets highly complex really quick. If I post some digital thing online and people buy it from 50 different states I have to pay attention to 50 different state tax policies. Oh my goodness. And some cities have different sales tax policies. Yes there's a threshold currently in the U. S. And many of the States you just dropped their V. A. T. Threshold to nothing I believe. So it's like no but they're also streamlining it. So there's this one stop shop they call it in the eu to make it easier to remit taxes and then they'll split it up amongst the Member States anyways. It's just I think we're doing a lot of catch up and trying to figure out how to interact across geographic boundaries with regards to the law, when human interaction has dramatically increased across boundaries. So I don't know if the answer is that's a lot of pontification for a friday night, and I'm gonna end here before the time goes off. And I look forward to talking to you on monday joe.
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