Free things on the internet of things

The Age of the Internet has spawned a number of changes in the way people think, chief of which is a growing sense of entitlement.

Since the dawn of the world wide web, people have been able to access and get to things quickly, easily, and relatively cheaply, if not totally freely. But with that has come the expectation that if it’s on our computer (the royal “our”), we don’t really want to pay more than we have to.

Just take a look at the battles over music and news media to see how people’s expectations have changed in when they should reach for their wallets.

But nowhere has the disruption of the internet been more keenly felt than in the sale of goods, both for the impact on brick and mortar stores as well as the hit on state coffers that rely on sales tax. Governors and legislatures around the country have tried any number of approaches to level the playing field and recover some of those lost revenues.

Massachusetts officials think they’ve hit on a solution but it’s running into hurdles from predictable sources: online retailers such as eBay, Google, and the like, and tech advocates who embrace the concept that information – and nearly everything else – should be free if it’s in the clouds.

Congress had passed a law prohibiting states from collecting sales tax if the seller has no physical presence in the state, originally intended to protect catalog sales and since applied to the new-age catalog store on your desktop or lap. The Supreme Court has upheld that so state officials have worked to hammer out agreements with some larger tech companies. Amazon, the leading bigfoot in the online retail business, has opened up retail stores and distribution centers in nearly every state, subjecting it to the sales tax in each place.

What Massachusetts revenue officials have done is create a regulation that says if a company embeds a “cookie” – a piece of tracking software that roams around your system and retrieves information for the tech company — on a computer in the Bay State, that constitutes a presence and they’re subject to the 6.25 percent tax. Depending on your point of view, it’s an ingenious approach or “kooky.” But a coalition of online retailers and trade associations have filed suit in Suffolk Superior Court, delaying the July 1 implementation date.

Massachusetts technically doesn’t have a sales tax but rather a “use tax,” which is a difference without distinction in some people’s estimation. But it’s what allows state officials to collect the tax from Massachusetts residents who make purchases in New Hampshire, for instance, if they catch the buyer. On a car purchase, it’s fairly easy because the tax gets paid when an owner registers the vehicle.

In days gone by, the state used to send spies to mall parking lots in New Hampshire to write down Massachusetts license plates. It didn’t work real well, but it did scare some people. The state also adopted a lump sum “safe harbor” payment for taxpayers to enter on their annual tax returns for all purchases under $1,000, with the amount varying with the gross income of the filer.

But the internet has posed the biggest problem, as it has in a number of areas of commerce. Just take a look at the closing of any number of chains in recent months.  Jon Hurst, president of the Massachusetts Retailers Association, has identified online purchases as the biggest threat to local retailers. And as it chips away at real-world sellers, it’s keeping state revenues stagnant. All but four states have some level of sales tax, including several states such as Texas, Florida, and Arizona that have no income tax filling the pot but fairly hefty sales tax rates.

It’s one thing to say the internet wants to be free but the question comes when does it pay its own way?

–JACK SULLIVAN


BEACON HILL

House leadership abruptly pulled its controversial rewrite of the voter-approved recreational marijuana law one day before a scheduled vote after a hail of criticism over the heavy-handed measure, including wording that would levy taxes of as much as 55 percent, which would be the highest in the nation by far. (CommonWealth) Gov. Charlie Baker punts when asked what level he thinks the pot tax should be set at. (Boston Herald)

Massachusetts will get a chance to vote on whether millionaires should pay a 4 percent income tax surcharge after a joint session of the Legislature approved the constitutional amendment. The issue is likely to face a court challenge and dominate the political discussion next year. (CommonWealth)

Baker proposes a legislative fix to a no-bail provision covering three-time drunken driving or drug-impaired drivers. The governor was responding to a recent Supreme Judicial Court decision that said the wording of the existing law was ambiguous. (Gloucester Times)

MUNICIPAL MATTERS

Boston Mayor Marty Walsh says he won’t endorse the so-called “millionaire’s tax” until he knows where the money will go and, in a wide ranging interview, said on reflection he’s good with the change at the top of newest city corporate resident, General Electric, even though it caught him off-guard. (Greater Boston)

The Quincy Zoning Board rejected a proposal for an “urban gardening” store in the Quincy Point area after residents complained the owner’s plan to sell marijuana-related growing items as well as use paraphernalia did not fit in a family neighborhood. (Patriot Ledger)

Westport selectmen are working on crafting a bylaw that would allow recall initiatives in the town after some residents expressed their anger that there was no way to remove members of the town’s Board of Health in the wake of a horrific animal abuse at a tenant farm last summer. (Herald News)

A housing study in Marlborough to gauge the impact of development on city services found that an increase of more than 2,200 units over the last 15 years did not add to the student population, which dropped by 300 in the same time period. (MetroWest)

WASHINGTON/NATIONAL/INTERNATIONAL

Special counsel Robert Mueller appears to be investigating whether President Trump obstructed justice in connection with Russia’s meddling in the 2016 election. (New York Times)

House Majority Whip Steve Scalise and three others are shot at a baseball field in Virginia by a lone gunman who was killed by members of Scalise’s Capitol Police detail. (New York Times) Globe columnist Yvonne Abraham sarcastically parrots the party line of the NRA and others who always insist that high-profile incidents like yesterday’s shooting is not the time to raise questions about gun regulations. Both parties should commit to more civil discourse, says a Globe editorial. Political observers are skeptical that any moments of civility or pause in hyper-partisan rancor will persist long following the shootings. (Boston Herald)

Maine Sen. Susan Collins fires off a letter to the editor to the Boston Globe, criticizing the paper’s editorial pressuring her to stand up to Trump. “The Globe’s editorial is a perfect example of why the center is shrinking in the Senate,” she writes. “Powerful ideologically driven groups constantly berate and threaten those of us who believe that public policy is complex, and yes, that the president has some views worth our support, such as his belief that poorly negotiated trade agreements cost us manufacturing jobs.”

ELECTIONS

Boston Mayor Marty Walsh sits down with the Dorchester Reporter to talk about his first term and his reelection bid this fall, saying, “I feel comfortable where I am.”

A Brockton man who was detained by the Secret Service in April for allegedly stalking former first daughter Malia Obama in New York has taken out papers to run for mayor in the City of Champions. (The Enterprise)

BUSINESS/ECONOMY

The question of whether to allow a one-day “sales tax holiday” in the state is likely to return to Beacon Hill soon, with retailers pushing for the measure, especially in the face of growing online sales that cut into their business. (Boston Globe)

EDUCATION

Drew Faust, who steered Harvard through a recession and promoted increased diversity at the university, will step down as president next June after 11 years. (Boston Globe)

University of Massachusetts officials say they’re eyeing a tuition hike rather than budget cuts as a way to make do in the coming year. (Boston Herald)

HEALTH/HEALTH CARE

The Supreme Judicial Court ended a two-year battle in ruling that a controversial needle distribution center run by private social service agencies in Hyannis is legal and can remain open. (Cape Cod Times)

The state Department of Public Health approves the closure of 13 psychiatric beds at UMass Memorial Medical Center in Worcester. (Telegram & Gazette)

ENERGY/ENVIRONMENT

Ken Kimmell, president of the Union of Concerned Scientists, says regional leaders must step up to address climate change if the Trump administration won’t. (Boston Globe)

A black bear, apparently unable to go in the woods, was found roaming a thickly populated residential area in Marlborough before he was tranquilized by state officials and moved to an undisclosed rural area and released. It is the same bear that was immobilized and relocated after being found in Worcester last month. (MetroWest Daily News)

CASINOS

Nearly 13,000 gamblers enroll in the state’s Play My Way addiction prevention effort. (Sun Chronicle)

Officials from  the city of Springfield and the under-construction MGM casino announce a $6.9 million streetscape improvement project. (MassLive)

CRIMINAL JUSTICE/COURTS

Margaret Monsell of the Massachusetts Law Reform Institute, Rahsaan Hall of the American Civil Liberties Union of Massachusetts, and Leslie Walker of Prisoners’ Legal Services say district attorneys abuse mandatory minimum sentences. (CommonWealth)

A man shot to death in Mattapan on Tuesday night became the second homicide victim in Boston in two days, following a fatal shooting a mile from the Mattapan scene on Monday. (Boston Globe)

An inmate died of an apparent suicide over the weekend in the Bristol County jail, the 16th such death at the facility since 2006. (New England Center for Investigative Reporting)

MEDIA

The news in the news business is not good. Time Inc. cuts 300 positions. (CNN) Layoffs are coming at the Huffington Post. (Buzzfeed) Canada’s largest newspaper chain, Postmedia, is in financial trouble. (Columbia Journalism Review)