Taxing online retail sales has become a sort of Lazarus for state governments. Each year, the idea is killed. The following year it rises from the dead.

Enough already. The idea is as bad for Iowa's consumers as it is for Iowa's businesses, at least those that dervive any part of their revenues from the Internet.

The tax has been resurrected once more among lawmakers on both the state and federal levels. With legislators raiding every piggy bank in sight, it would appear as though they hit a mini jackpot. The Iowa Department of Revenue and Finance estimates that taxing online sales would bring in up to $100 million annually.

To make the new levy easier to swallow (i.e., impossible to kill), some enterprising legislators have dreamed up a plan to use the expected online tax revenue to help finance the Iowa Values Fund.

The only hope here is that legislators really know what they're doing. Taxing Internet sales could open Pandora's box, which is why it's somewhat comforting that the Iowa Senate appears reluctant to settle the issue.   The idea ought to be killed outright.

First, there are laws in place that already tax Web-based sales. The responsibility for paying those taxes, however, is on the buyer. Needless to say, the government is having problems collecting that levy.

"The difficulty has been the ability to collect that tax because of small dollar amounts and large volume," laments David Casey, the manager of the policy section at the Revenue and Finance Department.

So lawmakers have hit upon a different mark: local businesses.

Up to now, states have lacked the cohesion necessary to turn their ideas into law. That is changing. Minnesota, North Dakota, South Dakota, Kansas and Wisconsin are pushing the matter in their own legislatures, Casey said. In all, 35 states are researching the tax, he said.

Legislators who favor the Internet tax would have you believe that additional taxes would level the playing field for local retailers. This is a classic red herring.

Research has shown that people shop on the Internet for convenience and to buy products they can't get locally. They don't do it to dodge taxes.

Hundreds of small Iowa businesses are benefiting from the ability to sell their products around the nation. They would be hurt by requirements to handle sales taxes themselves.

Bricks-and-mortar retailers have only to worry about tax levels in their own communities. An online retailer would have to track tax rates and file returns in every state in which it does business.

Dave McClure, president of the U.S. Internet Industry Association, estimated that a typical small business might have to file 600 tax returns annually (monthly in all 50 states) and deal with up to 36,000 additional local taxing authorities. Hiring a compliance department capable of handling those responsibilities would be a tremendous burden.

There are computer programs capable of doing the calculations automatically, but they are costly. Any added cost would be passed straight to the consumer. Why raise taxes on consumers in a down economy?

At the least, if state legislators are set on levying taxes on online retailers, they should give the same treatment to bricks-and-mortar companies. As it stands now, customers who buy Iowa products and have them shipped to out-of-state addresses pay no sales tax. Why not make the brick-and-mortar companies collect the sales taxes and remit them to whatever municipality the customer lives in?

Most small retailers have their hands full complying with the regulations in t heir own communities. Why force them to deal with 36,000 more local taxing authorities? It would be a mess.

This isn't to say that state legislators should avoid levying an additional tax because it would be too difficult to collect. Rather, they ought not do it because it's a bad idea.

Just like every other business today, government needs to learn to do more with less. Placing higher taxes on businesses already suffering from the economic downturn will make any recovery that much further off, which means that the real base for improving tax revenues will be delayed as well.