Apparently Australia will be the first country in the world to try this tax, and other governments will be looking on its outcome with keen interest.
This is what I think might happen:
1. People will see a way around it, either legally or illegally. The government will lose, and like the mining tax, be turned into a laughing stock.
2. In this country, we pay a premium on software and music by price gouging by companies like Apple and Microsoft. The tax will just make piracy more attractive.
3. The cost of enforcing it will be excessive, both in dollar terms and politically. Our government's CB radio licensing scheme in the late 70's and early 80's was canned only because the knew they were not profiting from the scheme. This may well happen with their tax on software.
4. The system will leak like a sieve, allowing plenty of creative tax dodging opportunities to spring up. Third party providers in zero software tax countries will act as intermediaries.
5. Software will be offered on line through eBay, and the vendor won't have to pay the tax. They buy the legal software, music or video, and resell it - tax free.
6. Very few, in any, politicians would have even heard of proxy servers, let alone know what they do. Proxy servers are used by 200,000 Aussies already to get the US Netflix rather than the second-class offerings from Australia. Smart people will just use proxies more to dodgy the tax. Maybe even proxy bank accounts.
7. The government might try to circumvent people avoiding the tax by hacking into bank accounts or getting transaction details on software from transaction houses like eBay. If you think this is crazy, consider this...
http://www.smh.com.au/national/canberra-reaps-360m-from-inactive-bank-accounts-20140609-39t8p.html. It is true. The government can steal money from your bank account and leave you to fight to get it back.
What the government should be doing to forgetting the end-user's tax on software, but instead forcing bad corporate citizens like like Microsoft, Apple and Google to pay their fair share of COMPANY TAX, rather than openly ripping us all off by funnelling money through Ireland, Singapore or Bermuda. The tax on "digital downloads" will be only 10%, but they will reap a lot more by forcing these these rogue companies to pay their 30% company tax rate like every other law abiding and decent company does.