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US Senators Push For Permanent Internet Tax Ban

by Mike Godfrey, Tax-News.com, Washington

24 September 2007


US Senator John McCain (R-AZ) has joined Senators Trent Lott (R-MS) and John Sununu (R-NH) to push for Congress to enact legislation that would make a moratorium on state and local internet tax permanent. The ban is currently set to expire on November 1, 2007.

“Keeping Internet access affordable is vitally important to all American consumers. If Americans want to know what their Internet access bill will look like if the tax moratorium expires, all they need to do is look at a phone bill,” McCain argued. “Taxes and government fees add as much as 20 percent to Americans’ telephone and cell phone bills and we cannot allow that happen to the Internet - likely the most popular invention since the light bulb.”

Senator McCain says he has fought to permanently ban multiple or discriminatory state and local taxes on Internet access and e-commerce transactions since 1998, when he helped champion legislation to make the Internet tax-free, spurring a three year moratorium on new Internet taxes. After the moratorium was extended twice, McCain joined Senators Wyden and Sununu in introducing the Permanent Internet Tax Freedom Act of 2007, on the first day of the 110th Congress.

“Excessive taxes dampen innovation and are regressive, hitting the most vulnerable customers the hardest. A tax on Internet services would be especially difficult on the millions of middle income Americans who use the Internet,” McCain stated.

According to a report by the Pew Charitable Trusts, middle income Americans’ Internet usage increased 68% between 2005 and 2006; and subscription access to the Internet has grown 121% for African Americans, 63% for older Americans, and 39% for rural Americans in that same period.

“Congress now has the opportunity to extend permanently the Internet tax moratorium and assure consumers that taxes will not inhibit the offering of affordable Internet access. In a little over a month, Americans will be forced to pay more to access the Internet, receive e-mails on their Blackberries and use the Internet on their cell phones if the Democratic leadership refuses to allow the Senate to debate and pass this legislation,” McCain concluded.


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