States Plan Taxes To Comprise Up To 21% Of E-Book Price

Kindle 2. Photo: Jon 'ShakataGaNai' Davis (CC)

Kindle 2. Photo: Jon 'ShakataGaNai' Davis (CC)

Those of us hooked on $9.99 ebooks had better get used to the idea of paying more in 2011. Not only are publishers and authors realizing that they are not making enough money to stay in business at that price point, but now state governments want in on the fast-growing sales. SmartMoney reports:

Taxes on e-book downloads to an e-reader, like the iPad, Kindle or Nook, could add up to 21% of the total price, assuming multiple states apply taxes to the same transaction, according to MyWireless.org , a nonprofit consumer advocacy group.

Roughly 9 million e-reader users download books. (On average, that’s three e-books a month at an average of $9 per book, according to Marketing and Research Resources and CEA, respectively.) These consumers are increasingly at risk of being taxed on those purchases by their home state and by the state where the book is published, says a CTIA spokeswoman.

The number of times a consumer is taxed could be even higher. For example, a county may decide to impose its own tax on downloadable e-commerce products. These taxes typically pop up at checkout. These additional taxes could make buying an e-book much more costly than buying a hard copy of the book at a local retail store, where only the sales taxes would apply.

So load up on ebooks this Christmas — next year they are likely to cost considerably more!

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  • ralph

    This is some serious bullshit. An eBook should NOT cost more than a physical one.

    Why can’t state governments come up with better ideas…?

  • http://disinfo.com ralph

    This is some serious bullshit. An eBook should NOT cost more than a physical one.

    Why can’t state governments come up with better ideas…?

  • http://www.xenex.org/ xen

    Golly, I am sure that arbitrarily increasing the price of ebooks so the government gets a bigger slice of a pie to which they are not entitled will in no way cause people to illegally download ebooks, which is often much easier than buying them.

  • http://www.xenex.org/ xen

    Golly, I am sure that arbitrarily increasing the price of ebooks so the government gets a bigger slice of a pie to which they are not entitled will in no way cause people to illegally download ebooks, which is often much easier than buying them.

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