Plan to Tax Adult Internet Companies Revealed

WASHINGTON — Targeting those who are “profiting by exploiting children and promoting irresponsible and obscene behavior,” Sen. Blanche Lincoln, D-Ark., on Wednesday announced a regulatory assault on the online adult industry with legislation that would impose a 25 percent excise tax on all adult transactions.

Lincoln’s rally to support the new legislation is tied to a study by advocacy group Third Way, whose report exposes statistics linking children to online adult websites. The report’s release coincides with Lincoln’s announcement Wednesday morning in Washington.

Third Way’s report claims that children between the ages of 12-17 are the largest viewers of Internet pornography, and the average age at which children are first exposed to online pornography is 11 years of age.

“The Internet has become our new American Main Street, and it’s literally transforming the experience of growing up in America in a way much different from the way parents of today grew up,” Lincoln said.

“Many Internet service providers have taken significant steps to provide parents with tools to protect their children from inappropriate material online and they should be commended,” Lincoln said. “But sadly, many adult-oriented websites in today’s online world are not only failing to keep products unsuitable for children from view, but are also pushing those products in children’s faces. And it’s time that we stand up and say, 'enough is enough.'”

Lincoln’s legislation, called the Internet Safety and Child Protection Act of 2005, has three objectives:

Force Online Adult Companies to Pay the Costs of Child Protection
The Internet Safety and Child Protection Trust Fund would be financed by a 25 percent excise tax on all online adult transactions.

Requires Age Verification
Online adult websites would be required to use software to verify the age of users attempting to access their websites. Online merchants, banks and credit card companies could not process payment transactions that are not age verified. The FTC would issue and enforce those regulations.

Establish an Internet Safety and Child Protection Trust Fund
The fund would centralize and coordinate the allocation of federal resources in support of efforts on the part of law enforcement and others to combat Internet and pornography-related crimes against children.

Original cosponsors of Lincoln’s legislation include Sens. Tom Carper, D-Del.; Mark Pryor, D-Ark; Mary Landrieu, D-La.; Joe Lieberman, D-Conn.; Debbie Stabenow, D-Mich.; and Ken Salazar, D-Colo.

Companion legislation also was introduced Wednesday in the U.S. House of Representatives by Rep. Jim Matheson, D-Utah and Rep. Robert Menendez, D-N.J.