Nearly every American has the ability to go online these days, whether through their smartphone, tablet, or other wireless device, or through a landline Internet connection. Internet access is vital to consumers and businesses alike, and that’s why what Senators Ron Wyden (D-OR) and John Thune (R-SC) did today is so important. They introduced the Internet Tax Freedom Forever Act of 2013 (S.1431), which would provide a sensible and fair framework for how we’re taxed on accessing the Internet.
The Internet Tax Freedom Act was originally passed in 1998 to impose a temporary moratorium on certain taxes that could have a detrimental effect on the continued expansion of Internet use in the United States. Every time it is due to expire, the moratorium is incrementally extended for a few more years. The current version is set to expire in November 2014.
The bill introduced today is a version of this pro-consumer legislation that would put in place a permanent moratorium on unfairly and arbitrarily taxing consumer Internet access. Here are some reasons why that’s important.
Americans of all races, ethnicities and socio-economic status use the Internet as a gateway to things like:
- Education
- Healthcare
- Jobs
- Entrepreneurial opportunities
And so much more…
The Internet allows Americans from all walks of life to equally participate and compete in today’s global economy.
Taxing Internet access, however, can be a barrier to adopting this valuable tool. This is particularly troubling in light of the extremely high rate at which other communications services are already taxed:
- Telephone and voice services are taxed at more than 17% on average.
- Cable and video taxes are about 12% on average.
- For perspective, the average sales tax is only 7%.
Those communications taxes are imposed by more than 10,000 different state and local taxing jurisdictions across the nation. We can’t let them pile on even more state and local Internet access taxes and fees!
If passed into law by this Congress, ITFFA would do a number of good things:
- Prevent state and local taxation of Internet access.
- Prevent state and localities from imposing multiple and discriminatory taxes on Internet commerce.
- Ensure only one state can tax each transaction.
- Prevent online sales from being taxed at a rate higher than in-person sales.
Without the ITFFA, these state and local taxes on other communications services could be expanded to Internet access, increasing the cost of service. The FCC National Broadband Plan says that cost is the largest barrier to consumer broadband adoption.
What You Can Do
Don’t let the Internet Tax Freedom Act expire! Encourage your Senators to support the Wyden-Thune bill that would permanently extend the moratorium on taxing Internet access.
This will protect you from having new taxes imposed on your Internet access and ensure Internet commerce will remain unhindered by discriminatory, duplicative taxes.
Please help spread the word: