Senate Commerce Committee Approves Net Tax Moratorium Extension

by Glen Shapiro, LawAndTax-News.com, New York

04 August 2003

The Senate Commerce Committee's decision on Thursday to approve legislation permanently extending the temporary moratorium on internet access taxes has been welcomed by telecoms and internet providers.

Commenting on the bill, a similar version of which has already been passed by a House Committee, members of the Senate panel observed last week that imposing additional taxes on internet access would effectively amount to double taxation, and would make the cost of connecting to the internet prohibitive for those US citizens who are currently without access to it

In a statement issued on Thursday, the Cellular Telecommunications & Internet Association (CTIA) announced that:

'Today the Commerce Committee blazed a new trail through the mountains of taxes that had previously loomed between consumers and the internet.' The Association also welcomed the technology neutral definition of 'internet access', observing that:

'Americans access the internet in a myriad of ways; this legislation ensures that no matter the method, that access will be tax free.'.

The Commerce Committee's chairman, Senator John McCain (R-Ariz) has warned advocates of online sales tax simplification that the two issues must be separated in the eyes of the public:

'In past years, the debate over the moratorium has been mixed with several states' efforts to broaden their authority to collect sales taxes from remote sellers,' he explained in July, adding that: 'In fact, many people even today seem to think that the Internet tax moratorium...is a ban on sales taxes on e-commerce transactions. It is not.'

Recommended