Home > News > Senate Delays Internet Tax Ban • Bookmark   • Newsletters   • Register Search Options

NEWS STORY

Senate Delays Internet Tax Ban

Get XBIZ News
Nov 7, 2003 12:00 AM PST    Text size: 
WASHINGTON, D.C. – In what has proven to be a far more difficult issue to resolve than expected, the U.S. Senate failed to decide whether to permanently extend the ban on Internet taxation.

The original bill that was enacted in 1998 put a ban on Internet access, but also included a grandfather clause that exempted certain states from the ban. If the bill is made permanent, those states would no longer be exempt and could stand to lose an estimated $9 billion in yearly revenue.

Originally scribed by Representative Christopher Cox (R. Calif.) of Newport Beach and Senator Ron Wyden (D.-Ore.), the Internet Tax Freedom Act (ITFA) of 1998 has gone through several incarnations since it was originally signed.

In September, the House of Representatives voted to make the tax ban permanent, although a likeminded resolution stalled out in the Senate and has led to lengthy and heated negotiations since the temporary ban expired on Nov. 1.

A final vote was expected today, but the U.S. Senate failed to endorse legislation that would have either extended the ban permanently or given individual states the right to levy taxes against users of dial-up and high-speed Internet access.

According to sources, negotiations will continue on through the weekend and might reach a resolution by Monday. There is some talk that a proviso might be agreed upon that would entail extending the bill for another two years.

Senator John McCain, chairman of the Commerce Committee, is one of the leaders who is brokering with Democratic and Republican Senators to reach a constructive resolution.

At the heart of the ITFA is the taxation of Internet use. In the early days of the Internet, most consumers got taxed for web access by their phone carrier and charged fees for use of a second phone line, although under the provisions of ITFA, no taxes could be directly levied against an Internet account. The original bill was drafted long before the proliferation of many emerging technologies, including high-speed Internet access.

The ITFA bill includes a provision that prohibits, and would continue to prohibit if renewed, states from taxing the DSL and dial-up access service that telephone companies often bundle with traditional voice services.

Opponents of the taxation ban claim that the broad wording of the bill threatens to ban telecommunications companies from all Internet taxation as carriers transfer their service from ordinary telephone services to next-generation Internet-based systems.

Sen. Lamar Alexander (R.-TN) has been an outspoken advocate of altering the language of the 1998 bill and making it easier for states to tax wireless connections and other types of Internet access never considered by the original 1998 ban. His proposal includes extending the bill for another two years only.

"What we are proposing is a two-year extension of the current law with one exception: level the playing field between the phone companies and the cable companies," Alexander said. "This short term solution allows us to craft careful changes in a rapidly changing technological world."

More ways to get XBIZ News:  RSS Feeds  |  E-Newsletters  |  Desktop Widget  |  Mobile
Looking for porn star news and behind-the-scene videos? Check out XFANZ.com !

BUSINESS ANALYSIS

Quality Network Partners Bolster Cam Studio Success

There is a potent dynamic in the cam world between consumers, models, networks and studios, with each playing a vital role in the forging of this erotic ecosystem. One often overlooked factor is the role... More »

Retailers Talk BDSM Shopping Trends

These days, BDSM is so mainstream that it is being depicted in everything from beer commercials to telenovelas. Floggers, paddles, ball gags and handcuffs were once considered the bad boys of adult retail;... More »

Specialty Manufacturers Talk Popularity of Handcrafted BDSM Gear

The proverbial cat is out of the bag for fetishes — and the dog, and the dragon, and a whole other slew of kink accessories that put blindfolds and handcuffs to shame. “Fifty Shades”... More »
XBIZ NEWSLETTERS
Stay informed of the latest industry developments. Get XBIZ newsletters delivered to your inbox. Subscribe today!
Enter email address:

* To manage existing subscriptions click here.






POPULAR PRODUCTS & SERVICES
Submit your press release to
multiple news outlets with 1 click.
Subscribe to RSS news feeds or
add free content to your website.
Access XBIZ news and articles
with your mobile device.
Access the latest issues of the industry's leading trade publications in digital form. View online or download for offline viewing.

UPCOMING EVENTS

XBIZ Retreat

May 30 - Jun 03
Miami, Florida

XBIZ Miami 2017

May 30 - Jun 02
Miami, Florida

XShow 18+ 2017

Jun 01 - Jun 03
Moscow, Russia

Cam Summit

Jun 02 - Jun 04
Lloret de Mar, Spain
Everyday thousands of business professionals browse XBIZ's industry directory for quality products and services. Not listed yet? Your company could be losing potential new business. Submit your company today!
Use XBIZ RSS feeds to stay informed of the latest industry developments or as a content syndication tool for your website!