The U.S. House Judiciary Committee is marking up a new bill today dubbed the Permanent Internet Tax Freedom Act, which would permanently extend a ban on local and state Internet taxes that dates from 1998.
A bipartisan group of House committee and subcommittee chairmen and ranking members first introduced the bill last September, which is backed by telcos and cable operators. A Senate version of the bill, S. 1431, was introduced by Sens. Ron Wyden (D-Ore.) and John Thune (R-S.D.). The Internet Tax Freedom Act has been extended three times since 1998 and is currently set to expire on Nov. 1.
Not surprisingly, the National League of Cities isn't thrilled with the bill. In a statement released late June 17, the NLC said the move to permanently ban state and local tax authorities from being able to levy taxes on Internet usage "prevents local communities from making their own decisions and determining how the programs and services they deliver to their residents." The moratorium was conceived to help the Internet grow when it was in its infancy, the NLC said. "But now that the Internet has become ubiquitous and more and more services are moving from a telecommunications/cable delivery system to broadband, it no longer needs special tax protection," the group said in a prepared statement.
Currently, More than 200 million Americans use the Internet. And while Congress, the FCC and industry players grapple with net neutrality rules that seem controversial no matter which way the discussion goes, this bill carries less baggage – the NLC's position notwithstanding – and is more likely to pass, according to The Wall Street Journal.
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