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RALEIGH – A legislative commission is studying whether the state should apply a sales tax to digital downloads.

The committee is looking to modernize North Carolina's tax code, written long before the existence of eBay, iTunes and Amazon.com.

"We used to think of everything in terms of being tangible," Rep. Paul Luebke, D-Durham, said. "Nobody thought of how you could possibly download anything."

Although any proposal from the study group is a long way from becoming law, the General Assembly could eventually change the language and definitions of the code to require more Internet retailers to collect sales tax during online transactions.

"So if you buy a book in a bookstore, you're going to have to pay sales tax on it," Luebke said. "If you're downloading a book from a book seller, you should have to pay sales tax on that as well."

Researchers say taxing music, video games, movies, books and software downloads could generate about $12 million during the next fiscal year. That could be helpful as the state faces down a $2 billion revenue shortfall that could get worse before it gets better.

But not everyone is on board with the plan.

"We would be concerned about any kind of new taxes in this economy," Brooks Raiford, president and CEO of the North Carolina Technology Association, said. "The consumer is already very highly taxed, the economy is stretched."

Raiford is also concerned about how the companies he represents would also be affected.

"All we're asking is that those considerations be taken carefully and that the industry be asked for their input as the legislation is finalized," he said.