Letters to the Editor

Slow transition not costly

Your editorial, "Transition Travails; No Mere Threats," (FCW, March 6) contains sweeping claims about the government's transition to the FTS 2001 program that are dead wrong — namely that incumbent vendors have delayed the transition by "not passing off the work fast enough" and that the government is losing money "because agencies are not able to take advantage of FTS 2001's lower rates."

Though not named in the editorial, AT&T is one of the incumbent vendors and wants to set the record straight.

    * As Federal Computer Week has reported, the slower-than-expected transition is attributable to a number of factors, including the Year 2000 changeover period as well as the preparedness of an FTS 2001 awardee. For our part, AT&T has cooperated fully with GSA and agency customers during the transition to FTS 2001 and will continue to do so.

    * Also as reported in FCW, AT&T's FTS 2000 bridge contract offers the same competitive prices as FTS 2001. The government is not paying more by using ATT; it has been saving money through the bridge contract since spring 1999.

Rochelle Cohen

Deputy Director for Media Relations

AT&T

No time-saver

I read with interest the article "Success in Record Time" (FCW, March 6). Perhaps instead of interviewing Rich Drury, NIH's director of human resources technology development, the author should have talked with those of us who have to use the Integrated Time and Attendance System.

The truth is, people really hate it! There have been numerous problems with those of us who work off-shifts, holidays and weekends.

The system cannot accommodate staff who must sign in on one day and sign out on the next. The system either refuses to let staff sign out for the correct amount of time earned or it refuses to let them sign out at all. Holiday pay continues to be missing or misapplied. Shift differential is often missing.

The system has been so bad that currently every nurse's time card must be reviewed by timekeepers by hand before submission. It certainly hasn't taken "... the timekeeping out of timekeeping." It has increased workloads on the timekeepers and placed an additional burden on the medical staff, who have no timekeeping experience.

June A. Kryk, RN, MS, OCN

National Institutes of Health Bethesda, Md.

Internet tax: No simple answer

I am always amused and saddened when a totally uniformed position finds its way to the pages of your otherwise well-informed publication. I am speaking specifically about Timothy Sprehe's opinion article ("Tax-free Internet means fewer IT workers," FCW, March 6).

First he takes a gratuitous slap at the entire information technology industry when he says "... of course [it is] solidly lined up in the ranks of tax-free Internet proponents." The fact is that many IT trade organizations, such as the American Electronics Association, have specifically acknowledged that Internet commerce ought to submit to the same tax policies as other industries, but only when (and if) the tax policy does not specifically discriminate against the Internet as the delivery medium. Let me explain.

There are two fundamental problems in the taxation of Internet commerce. The first is the specification of what jurisdiction is entitled to receive the tax (the "nexus"), and the second is who should be responsible for collecting and remitting the tax to the taxing authority.

The first issue is the thorny one. Only a couple of generations ago, the sale of a product and its use generally took place within a few miles of one another. Sales tax was collected at the point of sale, and nexus was assumed to be at that location.

With the explosion of catalog selling, however, the problem grew dramatically. The nexus of taxation was presumed to be at the recipient's address. The catalog companies have generally been successful in moving the collection and remittance responsibility to the buyer.

Enter the Internet era. Consider the following hypothetical, but realistic, sales event. The chief information officer of a law firm who lives in Connecticut buys a copy of Windows 2000 from a reseller in Massachusetts. The software is loaded on a server in New Jersey for use by the law firm with offices in New York, Chicago and Los Angeles. Where should the point of taxation be?

To compound (and confound) the problem, what if the software were downloaded from a Web site located offshore? Absent any sensible set of rules, we could have states fighting over the sales tax revenue. Who will be the Solomon to decide which state "deserves" the tax revenue? Should Microsoft collect it, or [should] the reseller? Will the tax auditors from New York, New Jersey, Connecticut, Massachusetts, Washington, Illinois and California demand the tax payment from the law firm one at a time or all at once? You get the picture.

Mr. Sprehe's article is just too simplistic. Our industry is prepared to pay its share of the tax burden. We just want consistent rules to follow that take the guesswork out of our tax policy. When the Internet tax commission comes up with those rules, we will be among the first to support their introduction. It could be a long wait!

Ed Bersoff

Chief Executive Officer

BTG Inc.

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