La. House Passes Internet Tax

Tod Hunter
BATON ROUGE, La. —The Louisiana House last Thursday voted a 15-cent tax on monthly Internet bills by a 81-9 vote.

The tax would go into effect next year and be added to monthly Internet bills. Public libraries and public schools would be exempted. The new tax will give the state attorney general's office an estimated $2.4 million a year to investigate Internet crimes, including online fraud or sex crimes against children.

The next step for the bill is consideration by the state Senate, but if it passes, La. Gov. Bobby Jindal is expected to veto it.

Jindal's press secretary Kyle Plotkin said in a statement, "While we absolutely support cracking down on sex offenders that prey on our children, we're opposed to raising taxes on the people of Louisiana."

If approved, the bill could also face challenges if it is in violation of the Internet Tax Freedom Act Amendment Acts of 2007, a federal law signed by President Bush in November 2007, which prohibits state and local taxes on Internet access and commerce. "I think this tax, if it is signed into law, would have a pretty minimal impact on adult websites," Marketing Director Q Boyer told XBIZ. "The larger impact — if the tax survived the inevitable legal challenges — would be the spread of such taxes around the country, to the point where every state enacts some similar tax. I think that scenario is very unlikely to play out, but that's the real danger here; the impact of such a measure as precedent that other states would follow, more than the impact of this tax in itself."