It's official: the Minnesota legislature adjourned this week without passing a tax on internet transactions.

 

The Democratic-Farmer-Labor led legislature had originally pushed two etax bills. The first would impose a tax on digital goods (HF 1980/SF 1839), such as music, movies, books, and ringtones. The second (HF 401/SF 282) would attempt to circumvent the Dormant Commerce Clause of the U.S. Constitution to charge consumers a tax on all goods purchased by online retailers.

 

After sending Gov. Tim Pawlenty (R) a $34 billion budget that overspent revenues by $3 billion, the Governor announced that instead of adopting the legislature’s proposed tax increases – which included the etaxes – he would trim the budget with line item vetoes. This brought the legislature’s push for both internet transaction taxes to a screeching halt as the legislature adjourned earlier in the week.

 

Similar bills are still under consideration in North Carolina, Vermont, and other states. Be sure to check out the Take Action section to write your legislators!