CRP Blog



Wednesday, May 23, 2007

Here we go: Will Democrats allow new Internet access taxes?

The Democrats in Congress have a decision to make: should they renew the federal ban on Internet access taxes, or allow state and local governments to start taxing our Internet access in the same over-the-top way they already lard up our phone bills with taxes?

Former California Republican Congressman Chris Cox (now Chairman of the SEC) was a leader in moving the Republican Congress to twice ban Internet access taxes, as well as discriminatory taxes directed solely at online commerce. President Clinton signed the original Internet Tax Freedom Act, while President Bush signed the Internet Non Discrimination Act. Both laws prohibit state and local governments from levying special taxes on your Internet access.

Now, predictably, Democrats are considering allowing the ban to expire on November 1.

"The power to tax involves the power to destroy," observed Supreme Court Justice John C. Marshall in 1819. Online purchases are already subject to state and local sales taxes. Rather than stopping there, those arguing to allow the ban on Internet access taxes to expire are arguing in favor of not just taxing your purchases -- but they are supporting the equivalent of taxing someone just for walking into the store.


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