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US set to extend internet tax ban

31 октября 2007

The US House of Representatives on Tuesday voted unanimously to extend a tax moratorium that was first adopted to promote US internet access in the early days of the online medium, despite state and local government opposition.

US set to extend internet tax banThe latest ban, which prevents local authorities from levying a number of potential internet taxes, marked a victory for technology and telecommunications companies. While short of the permanent ban they had lobbied for, it still extends the moratorium for seven years.

Supporters argue that the tax ban, dating from 1998, helped to stimulate a high rate of internet penetration in US homes early on. However, while the US now also claims a high rate of usage for broadband access, the speed of most domestic US broadband connections is far slower than those seen in other countries, making this the main current focus of public policy debate.

Tuesday’s vote follows Senate support for the legislation last week, and the measure is expected to be signed by President George W. Bush before the current tax ban expires on Thursday. Organisations representing state and local authorities had called for a shorter extension, and a narrower definition of the taxes that could not be levied.

“While we will continue to fight for a permanent measure, for the next seven years at least, the private sector can invest in e-commerce and broadband deployment without fear of discrimination,” said Phil Bond, head of the Information Technology Association of America.

The federal tax ban was passed to stop the creeping local taxation that began in the mid-1990s as authorities started to apply taxes to the new medium. It prevents the taxation of internet access, as well as discriminatory taxes that treat internet activity differently from other types of sales.

Источник: Financial Times

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