House Passes Internet Tax Ban

computerlady writes "InfoWorld reports that the House of Representatives today voted a permanent ban on 'levying taxes unique to the Internet.' The Internet Tax Nondiscrimination Act would permanently prohibit taxing jurisdictions in the U.S. from levying such taxes as e-mail taxes, bandwidth taxes, or bit taxes. To become law, the bill would have to pass the U.S. Senate and be signed by President Bush. The Senate Commerce, Science and Transportation Committee approved its version of the bill July 31, and its next stop is the full Senate."

Comments

States Rights

[Dancin_Santa]

Don't mean to be a party pooper, but your state is still able to charge you a sales tax on all catalog and web transactions.

No one will come knock on your door if you don't pay, but it's nice to have that weigh on your mind, you tax-evading thief.

Re:States Rights

[freeefalln]

'levying taxes unique to the Internet.' The

Unique to the internet. that is whats important here. we all know that sales tax is long overdue on the internet, it will come into effect sooner or later.

Re:States Rights

[princewally]

Also, there has been a ban on interstate sales tax in many jurisdictions for many, many years. If you order something by mail from Oregon and you live in New Jersey, you don't pay sales tax.

In most states, you do have to pay sales tax if you order something from another state. The company isn't required to charge the tax. You are supposed to get an additional form from the state and declare your purchases yourself.

Re:States Rights

[NickFitz]

Here in the European Union, it arrived as of July 1st 2003. Purchases made online within the EU are liable to VAT (Value Added Tax, the EU version of Sales Tax), even if the supplier of the goods is based and shipping from outside the EU.

Some details here.

Choice quote...

[Ratface]

"This bill would broaden access to the Internet, expand consumer choice, promote certainty and growth in the IT sector of our economy and encourage the deployment of broadband services at lower prices. " ... so how come a bill that ensures that the Internet will stay as untaxed as it already is (for Americans at least), manages to promote all those great changes huh?

Oh well, can't complain too much, at least it's positive news. I just though it made good spin! :-D

Re:Choice quote...

[Talthane]

Because if you're a company that has something to do with internet services, and there were rumours of a 'net tax, you'd probably stop some of your initiatives and hoard money as a contingency fund.

When the quote says 'certainty', that means a lot to any risk-conscious company. If you have a risk mitigated or removed, you feel safer in going ahead with an initiative like setting up broadband, etc.

Finally, a step in the right direction!

[goldspider]

Can you remember the last time that Congress actually prohibited a form of taxation? In a country where we roughly pay an average of 1/3 of our salaries to variuos governmental entities, I welcome anything that potentially keeps money in my pocket.

Of course, socialists and Bush-bashers are going to hate this on principal, but I think most of us can see the positive conotations such a law has.

Re:Finally, a step in the right direction!

[mental_telepathy]

I welcome anything that potentially keeps money in my pocket

You're in luck. I think "Anything to keep money in my pocket" is the Bush campaign slogan for '04.

The reality of a law like this is that it's a PR move. The only thing that can legitmately reduce the tax burden is a cut in spending. Trust me, you'll end up paying that Bush deficit eventually, no matter how sweet a nice fat refund check is now.

You: Yay! Not Internet Tax
Government: Your Walrus pacifier tax is due.

Re:Finally, a step in the right direction!

[King Babar]

1/3? I don't know what tax bracket you're in, but after Fed, SS, Medicare, State, Local, property tax, Sales tax, auto registration, and other various fees, most of us in the U.S. pay over 50% of our salaries to the gov.

In a word, no we don't. Not if by "most of us" you mean "most US taxpayers". For a decently readable account of this and other economic "facts", there's a piece in the NY Times (free registration blah blah).

Re:Finally, a step in the right direction!

[perly-king-69]

Here in Europe whilst we do have healthcare free at the point of delivery, you Americans do have some wonderful ships, aircraft, tanks, missiles etc.

Re:Finally, a step in the right direction!

[goldspider]

"The reps, however, want to get rid of all the taxes, but still have enough to only pay for the stuff they care about, like the military."

You say that like that's a bad thing. Whatever happened to the concept of "limited government"?

"We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America."

While this famous quote isn't a comprehensive examination of our government's structure, it is a decent summation of what should be the boundaries of our government's role in our lives.

Nowhere in that quote is mentioned a guarantee of prosperity, nor does it speak of a responsibility of the government (through taxpayers) to provide for those who can't or won't provide for themselves.

Quite simply, the government was never intended to function as a means to redistribute the wealth of its citizens; to divert money from one group of individuals to another.

"I learned in economics class that if x then taxes should go up and if y taxes should go down. I want a government that took economics class."

I'm 100% in agreement with you there. That's one of my beefs with the current administration.

Re:Finally, a step in the right direction!

[DickBreath]

Europe is looking more and more attractive. You actually GET something in return for your taxes there.

I disagree. Just look at all of the additional value we get here in the US for our tax dollar...

• DMCA
• UTICA
• CALEA
• COPA
• CDA
• Our well-oiled smoothly running Patent office -- where applications are processed and granted quickly -- probably most smoothly running in the world.
• Our enlightened Copyright extensions
• War on Drugs
• War on Terror
• War on Freedom
• The largest NoooKuLar Arsenul in the world

...and, think of the tax dollars we save by having our legislators and judges bought and funded by private corporations. After all, the ability to own property, such as legislators or even mere ideas, is one of our basic values.

Re:Finally, a step in the right direction!

[TamMan2000]

It isn't a "Bush" deficit because we already had an increasing deficit before he moved into office!

Does anyone else remember Bush using enormous budget surplus predictions as justification for a tax cut?

Re:Finally, a step in the right direction!

[guacamolefoo]

Can you remember the last time that Congress actually prohibited a form of taxation?

Poll tax. The Twenty Fourth Amendment was passed by Congress on August 27, 1962, and it was ratified by the several States in early 1964.

GF.

How could they legally tax those products anyways?

[StormyWeather]

I don't see how the states could tax internet transactions anyways. Isn't that part of the fundamental way our government is set up, so that states cannot levy taxes upon cargo from other states? If they could states like Oklahoma could really rake it in for things going through their state from Texas to Kansas. Man I wish I hadn't slept through government class on that subject now.

Finally...

[Clinoti]

I will stop getting those stupid emails about the internet tax for emails, and bandwidth taxes, etc...Which is the good side.

BUT on the other side of the equation a part of me would not mind paying an internet tax on emails, if it would help in the battle against spam and junk mailings...although one may assume that the senders have deep pockets.

So in this end this really resolves nothing for me. Execept for a link I can point to when I get the next barage of "Internet Email Tax!!!" emails. :)

Re:Isn't this a state thing?

[I8TheWorm]

Um.... since the Uniform Commercial Code was enacted?

Why?

[pubjames]

I know that nobody likes taxes, but given that some taxes have to be collected, why a special ban on "internet taxes"? I pay special taxes when I take a flight, for instance, why does the airline industry have to suffer special taxes but the internet industry doesn't?

Now, something like a tax per email would of course just be dumb, but would a fixed household-based tax on broadband be dumb? Especially bearing in mind that the gov. needs to police the internet to a certain extent (to those that say they don't, get back to me when your Mom gets their banking details stolen or your friend gets defrauded by a mock ebay site).

Re:Why?

[SmallFurryCreature]

You already pay a tax on broadband silly. Well at you least in europe. It is called a sales tax. or BTW or VAT or whatever other name they have given to the tax applied to everything that is sold.

What a internet tax would be is a tax not on your vacuum cleaner but on how many times you hover with it as well.

An email tax would be a double tax. First you pay for the bandwidth, then for the use of that bandwidth? Like charging me BTW for a loaf of bread, butter, and toppings. Then charging me a tax when I make a sandwich out of it and eat it myself.

missed opportunity on SPAM fight

[scsirob]

As much as I'd hate to see internet tax, it might be a mechanism to fight SPAM. Introducing a tax of 1 penny for each e-mail sent would set the average user back about $1 - $5 a month.

SPAM houses would pay through the nose... I thin this would be a small investment for all of us to make junk mail less profitable.

Re:missed opportunity on SPAM fight

[FrostedWheat]

SPAM houses would pay through the nose

Yes, because as we know most of the spam we get comes from the USA. Really tho, that's just a stupid idea. Even for fighting USA-based spammers.

Go stand in the corner!

Re:Keystrokes

[richie2000]

But then, maybe they should just tax pr0n.

By the inch?

Damn Republicans....

[snatchitup]

Oh wait.... Is that right? We like this don't we?

Short Sited decison?

[jez_f]

OK this may be a little controversial but I think that in the future a 'bandwidth tax' or some such thing may not be a bad idea. We supposedly moving into an age of the information economy. Some people through the Internet have more access to information than others, this information makes their life better. They can look for better jobs, be better informed on what is going on in the world and make more productive decisions accordingly. This situation will get worse as more and more services move exclusively online. The info poor will have fewer opportunities.

If you see tax as a way of re distributing wealth to help the less well off then you could conceivably charge a bandwidth tax and put the money into public net access. I know not everyone sees tax this way but it dosn't seem like that bad an idea to me
It could also be used to help fund Internet monitoring, which I know no one likes but the government is going to do it anyway so why shouldn't people who use more bandwidth pay a greater share of the cost?

Would Taxing Be Feasable?

[kaellinn18]

Would putting a tax on internet transactions even be feasable? Granted, it would be relatively easy to track sales from huge companies like Amazon, but what about the individual selling stuff off of their own website eBay style? You would literally have to track down every single website that's selling something and make sure they're obeying the tax laws. Also, what about sites that are international? Would these laws be enforcable for us buying things from other countries or people in other countries buying things from us? The internet is a global entity, not just in the USA. I can see taxing e-mails, but I'm not sure how you would effectively tax online sales. Please feel free to explain to me how it could work, because I am interested.

Prohibits taxing access, not e-commerce

[wayward_son]

This bill prohibits the taxing of the access to the internet, not sales taxes on goods purchased over the internet.

A good law. I think the politicians should keep their grubby hands off internet access.

Re:cool

[RevDobbs]

Im ready for this, and confident I can handle it.

... until your internet access goes down.

Don't forget the aircraft carrier...

[alexhmit01]

The American military has lots of excesses from the cold war. We have too large of a surface and submarine fleet. Without the former Soviet fleet, there is no need for our forces to be SO biased towards responding to a nuclear first strike (where first strike is designed to incapacitate our land-based missiles from responding), etc.

We should probably shift more of the money from excessive stealth fighters (there are no dogfights anymore, we just need a first wave to take out anti-aircraft response) towards more troops and better equipment for them.

However, if you are going to talk about the American military, it's our aircraft carriers that let us rule the world. That is how we can project power across the globe. It let's us send air power anywhere.

I look at things in Europe and the US the way children and adults see life. Children see the next purchase as a video game, and that their parents should pay for it. Adult understand that they need to work hard, earn a living, and pay for things like food and shelter.

You expect others to pay for your desires, we understand that we need to pay our own way.

You would think that 50 years of the US subsidizing Europes existance, plus the thousand year head start on civilization would put your standard of living tremendously beyond our own. However, the opposite is the case. Somehow the side affect of expecting others to pay for your lifestyle has resulting in productivity hits that are more significant than the savings from having us subsidize your defense.

Money has to be made, by producing goods and services desired. Anything granted by the government is a hand-out from money taken at gun point from those that produce wealth. Money is an indicator of productivity, nothing more.

Alex

Is VoIP Unique to the Internet?

[Mikkeles]

I wonder how this will affect Vonage 's fight with Minnesota over the proposal to tax VoIP?

Email Tax

[MacGod]

DISCLAIMER: I am not trying to be flamebait here, this is my honest opinion:

I'm torn about the idea of an email tax. While in general I don't like the idea too much, it does occur to me that this might be the only way of dramatically reducing spam.

Look at it this way: Even a wicked-busy web maven likely sends less than 1000 emails a day outside of their own company LAN (with a few exceptions I realise. Individuals likely send less than 100 per day in general.

So, say you put a tax, to be administered by your ISP on each email, of say 0.1 cents per email. Big Business guy gets charged $1/day, home user $0.10 per day. By no means big money. Johny McSuperSpammer, however, who sends out 10 million emails every day, gets a handly little bill for $1000. Kind of changes the economics of his penis enlarger ads.

Like I say, I'm not a huge fan of paying more, but it does seem like making emails cost per message sent might be the best/easiet/only way to dramatically reduce spam.

Furthermore (ideally), to make up for the cost, you ISP could take $5 per month off your bill, to make up for the extra you're spending to send email. They still make money, because of the tax, the financial hit for you is minimal, but the spammers get hosed.