I tried Apple’s music sharing service on the day it came out. I bought
a single $0.99 music track, just to see how it worked. Of course, it
worked flawlessly, giving me endless possibilities for spending huge
amounts of cash. I was taken aback a day later when I got the receipt
for my downloaded track. That $0.99 track actually cost $1.09. Why the 10 cent increase? Sales tax, of course.
I had to ask myself, where is the “product” to be taxed in a downloaded “file”? To me, downloading data is more akin to performance art than the transfer of physical products.
What is data, really? Data is an idea, an abstraction, a particular collection of positive and negative assertions encoded on a spinning magnetic platter, later interpreted by the end user in a manner that they find pleasing. Tax on this apparatus was duly paid when it was purchased, and tax on the connection to the telecommunications infrastructure is paid every month.
Interestingly enough (in the case of my downloaded music track) I didn’t even get my copy from Apple. Technically I got my “copy” from my upstream router when it started wiggling bits on the other
end of my DSL line. To tax one “copy” of this data over another is ridiculous, as not only should I be taxed, but so should every machine between me and the server I “downloaded” it from. If data were a product, it would most logically be my ISP who should have to pay sales tax on items I download, just as manufacturers and distributors don’t pay sales tax, but stores do.
This analogy sounds ridiculous because data isn’t a physical product. It doesn’t behave like physical products, and only exists as a particular arrangement of switches. To me, data actively transmitted over a network is free speech in its purest form, where good neighbors agree to relay information between them for the benefit of the entire network. Where is the “product” in this global game of whisper-down-the-lane?
I’m picking on taxes because they most clearly illustrate the
conclusion I’ve arrived at: that considering data as a “product” is
possibly the most mundane way of interpreting what happens when people exchange information, and as such, will attract tax men, middle men, and other clingers-on.
As a result, I’ve decided to release all of the work I’ve done so far under the Creative Commons license. My software is already freely available; I would like the rest of my meager effort here on planet Earth to be freely available as well. Details will be forthcoming once I work them out with my publisher.
All in all, I think this planet could use more people actually producing good data, and fewer people bickering over it…
Should digital data be considered something new, or should it be subject to the same rules as the stuff you find in stores?