| This dissertation uses the policy networks, public choice, and historical institutionalist paradigms to analyze US and EU policymaking concerning the taxation of electronic commerce. Of these paradigms, the historical institutionalist paradigm is found to have the most explanatory power. If the objectives of a consumption tax system are to maximize economic efficiency and to facilitate tax administration, a nationwide value-added tax is the optimal consumption tax for the US and should replace the state and local sales and use tax, but existing political institutions make such a substitution unrealistic. Instead, policymakers should seek tax neutrality by taxing products sold online in the same manner as those sold offline, and under certain conditions, they should close a peculiarity in tax law that allows remote vendors to avoid collecting use taxes from their customers. |
