HB10-1192 will tax software downloads in Colorado. That’s right; you will now owe sales tax on your downloaded software. You already pay sales tax on software if you buy it off the shelf, but now, thanks to Gov Ritter and the Dems you’ll owe it when you purchase and download software on the Internet.
There is some argument over whether or not this is a brand new tax, but there is no argument that this tax hasn’t been on the books since 2006. Now they are going to start trying to collect it. You should be mad.
Every time you download new anti-virus software. Every time you buy that new killer app for your Iphone. You will owe some sales tax to the state. It doesn’t matter that the state has no business in your computer and no part in the transaction. They want their money from you.
Businesses are the real target of this tax. Sometimes businesses buy really expensive software and the state wants a cut of the action. Doesn’t matter that the download cost the state no services; the state wants their money.
This part adds up to some real money. Some businesses are just going to say no. They will locate elsewhere. These companies are very mobile; you can’t just add a tax like this and think that there will be no consequences. They will move; other companies will say thanks but no thanks, we’ll move to Nevada.
In either case, it is bad for Colorado.
We need to encourage businesses to locate here, not chase them out. This is another of the colossally bad ideas put forth this session.