Your making an assumption that tax rates are directly proportional to revenue. In fact, for elastic demand, tax rates are inversely proportional to revenue. This is why utilities such as water and power can essentially raise taxes at will because it hardly effects the demand. While online shopping.. If it&#x27;s taxed more people would just find and alternative or just not buy at all.<p>If you lower taxes on something that means more people use it or buy it, which means there&#x27;s a net gain of taxable activity as a rate approaches zero. Of course a zero tax doesn&#x27;t follow those rules, but an increase of internet activity results in an increase of sales which means an increase in the amount of taxes paid by that business, an increase in the number of people hired and thus an increase in the amount those people pay in taxes.<p>So a zero Internet tax rate would necessarily increase economic activity resulting in an increase in overall revenue despite a lower effective rate.<p>The Keynesians ought there might disagree, but Friedman proved them wrong in the 1970s.<p>I know the left wing is in love with high taxes but that&#x27;s based on the mistaken understanding that the government is a better arbiter of how to spend our money than we are as well as a political desire to give things to people that didn&#x27;t earn them.