Here's the hassle...
Say you spend thousands of countless hours honing your craft, you put together a band, play hundreds or thousands of crappy clubs for a measly handful of cash, sell CD's out of the trunk of your car... anything to scrape by while you get noticed. An agent or label finally takes notice, you sign a contract and you hit the 'big time'.
Your record is a big hit, people download tons of copies off the net for free and you can't pay back the advance the record company gave you.
Your traveling all over the country, making all kinds of appearances, just to sell the album... You're working for fuckin' free because of the lousy advance you can't pay back because everyone downloaded your 'good' tunes for free off the net instead of picking up a CD at best buy!
I'm not a saint...
I'm a business man with (dare I say it) ethics. I don't do to others what I don't want done to me. If I expect people to pay for product, I expect to pay for it to when I consume. Don't like buying an album half filled with stuff you don't want to listen to??? Go to iTunes and pay to download singles.
Now about the 'net tax'...
I'm against states being able to tax sales or profits made from purchases by consumers in their state because the administrative burden of being responsible for collection and payment to hundreds or thousands of municipalities across the country would be overwhelming for almost all small businesses that utilize the internet to earn revenue.
That being said, I would support a small (1%-4%) federal sales tax if it were utilized to modernize, computerize and add high-speed infrastructure to every grade school, intermediate school and high school in the country.
Let's face reality, in today's global economy American kids are at a distinct disadvantage to other nations (such as India) when it comes to technology education. Let's face another issue... I don't think we need any more highly educated foreign nationals coming to the US and taking jobs that could be filled if our education system was doing it's job.
The economy of the future will be dictated by the country that has the highest computer literacy. That country needs to be the USA or our way of life will disappear... guys like Osama will make sure of it.