Senate Finally Backs Internet Tax Ban

WASHINGTON – After laboring over the issue of Internet taxation since November 2003, the U.S. Senate voted 93 to 3 to give the ban on taxing high-speed, wireless and dial-up services another four years.

The temporary extension was presented as a salvo by senators who felt that a permanent moratorium on online telecommunications services would unduly harm state and local governments and deprive them of badly needed revenue.

The decision is considered a compromise and is expected to spur the rollout of high-speed and wireless services.

The original ban, which was passed in 1998 as the Internet Tax Freedom Act, occurred before the advent of high-speed access and only applied to dial-up services. Prior to this week's decision, high-speed access was subject to taxation, although service providers are now expected to phase out that taxation process over the next two years, taking a projected loss of $100 million.

The bill that passed through the Senate yesterday was an amended version of the former, and managed to strike middle ground in the fierce debate among lawmakers.

"The bottom line is, the Senate passed a bill that will end technological discrimination and save consumers millions of dollars," said Ron Wyden (D-Ore.), one of the authors of the original bill, which asked lawmakers to approve a permanent ban on Internet taxation.

The Senate vote also ended the controversial debate over the 10 states that had been exempt from the 1998 tax ban, which enabled them to tax both dial-up and high-speed access. Lawmakers in favor of keeping those states exempt were concerned that revenue losses would tally into the billions of dollars. According to the Senate's vote, those states will remain exempt from the four-year ban.

Those states include Hawaii, New Hampshire, New Mexico, North Dakota, Ohio, South Dakota, Tennessee, Texas, Washington and Wisconsin.

Copyright © 2026 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

Luxembourg Media Regulator Fines LiveJasmin for AV Noncompliance

The Luxembourg Independent Audiovisual Authority (ALIA) has levied a fine of 25,000 euros (approximately $28,000) against webcam platform LiveJasmin for failing to comply with provisions of the country’s Electronic Media Law.

AdultHTML Introduces Subscription Option for Website Owners

AdultHTML has added a subscription option for its web development service, allowing site owners to pay a monthly fee for access to developers and tools.

French Parliament Rejects Ban on Purchase of 'Remote' Sexual Services

The French National Assembly has backed off from a proposal to criminalize the purchase, and/or facilitation by online platforms, of sexual services performed remotely by streamers and custom content creators.

2027 XBIZ Exec Awards Pre-Nominations Period Opens

XBIZ is pleased to announce that the pre-nomination period for the 2027 XBIZ Exec Awards, the adult industry’s preeminent career honors, begins Wednesday and runs through Oct. 14.

Takedown Piracy Reports Infiltration, Monitoring of 'Mega.nz' Pirated Content

Takedown Piracy has reported that the organization has successfully infiltrated Mega.nz folders and identified and removed nearly two million instances of stolen content.

Pornhub Unblocks Australia Users on iOS Devices, Citing Apple AV Effectiveness

Pornhub parent company Aylo on Tuesday announced that users in Australia will once again be able to access the popular site if they are using Apple devices and have confirmed their age through Apple’s Australian age-verification process.

California Governor Signs Bill Limiting CIPA Claims

Governor Gavin Newsom has signed into law a bill to narrow the scope of the California Invasion of Privacy Act (CIPA), to prevent abusive lawsuits targeting online businesses, including adult websites.

California Enacts Stricter UGC Rules for Adult Sites

Governor Gavin Newsom has signed into law a bill to impose tighter compliance standards for user-generated content (UGC) on adult websites accessible in California.

Minister: UK Aims to Begin Enforcing 'Choking' Ban Before Year's End

The U.K. will soon begin enforcement of a new law criminalizing depictions of “non-fatal strangulation” in adult content, according to a Ministry of Justice official.

XBIZ LA Conference Website Now Live, Registration Open

The event website for the XBIZ LA conference is now live, offering comprehensive information about the upcoming event, taking place Jan. 7-10 at the JW Marriott L.A. LIVE.

Show More