Good News From the House

I like it:

Despite grumbling from lawmakers who want a permanent ban, the House voted overwhelmingly Tuesday to extend for four more years a moratorium on taxation of Internet access.

The bill (HR 3678) passed 405-2, The existing ban on Internet access taxes will expire Nov. 1 unless Congress extends it by that date.

Although supporters of making the ban permanent had enough votes to amend the bill to their liking, Democratic leaders put it on the floor under suspension of the rules, a procedure that bars amendments and is usually reserved for less controversial legislation.

“Basically, what the Democratic leadership has said is, ‘Here’s four years, take it or leave it,’ ” said Republican Robert W. Goodlatte of Virginia, cosponsor of a permanent ban.

Melvin Watt, D-N.C., said there was a very good reason for the decision to go with a moratorium extension rather than a permanent ban. “The Senate has not done anything yet and in many ways has made it clear that a permanent moratorium would be dead on arrival,” Watt said.

Four years is better than nothing, and unlike the permanent ban, this bill actually stood a chance of being passed.






16 replies
  1. 1
    Fe E says:

    Republican Robert W. Goodlatte of Virginia

    Good but not great.

    I’m a bit more partial to french press as opposed to espresso drinks.

  2. 2
    Zifnab says:

    Horray! Balloon Juice continues to cost me nothing! (except hours out of my workday)

  3. 3
    KCinDC says:

    Yeah, whenever I see his name, I think we need a couple more Republican congressmen named Nicesushi and Excellentnewyorktimes. It really only has two syllables, though.

    I’m fine with the ban, but I’m not clear on why we must fight tooth and nail to ensure that Internet service be forever preserved from taxation when the same doesn’t apply to phone service, or groceries.

  4. 4
    whippoorwill says:

    Melvin Watt, D-N.C., said there was a very good reason for the decision to go with a moratorium extension rather than a permanent ban. “The Senate has not done anything yet and in many ways has made it clear that a permanent moratorium would be dead on arrival,” Watt said.

    OMG, common sense breaking out in the congress, Quick, somebody call the CDC before it spreads.

  5. 5
    MNPundit says:

    In Minnesota there is no tax on food items.

  6. 6
    MNPundit says:

    Addendum: I meant Sales Tax.

  7. 7
    r€nato says:

    Has anybody driven by the internet’s house to see what its kitchen counters are made of?

    Ooops… wrong thread. My bad.

  8. 8
    The Other Steve says:

    In Minnesota there is no tax on food items.

    Clothing… most states don’t tax food. Minnesota is unique because of the clothing sales tax exemption. It’s what makes the Mall of America a draw.

  9. 9
    The Other Steve says:

    Congratulations Mrs. Paul Tsongas!

    Niki Tsongas wins special election

    The widow of 1992 presidential candidate Paul Tsongas defeated the brother of an American Airlines pilot who died in the Sept. 11 attacks Tuesday in a special election for the U.S. House.

    With 86 percent of precincts reporting, Democrat Niki Tsongas had 51 percent of the vote to 46 percent for Republican Jim Ogonowski.

  10. 10
    Jess says:

    Minnesota is unique because of the clothing sales tax exemption.

    Massachusetts doesn’t tax clothes under a certain amount either (I think it’s $250). I’m so happy.

  11. 11
    Nancy Irving says:

    I see no reason why the internet should be exempt from taxation.

    It’s not as if it’s a struggling industry. In fact, many industries that *are* taxed are struggling *because* of the internet.

    No one likes paying taxes, but there’s no logic to this, unless you count the idea that all taxes on anything anywhere at any time are baaaad, as logic.

  12. 12

    Nancy,

    In philosophy I agree with you, the internet is ripe for taxation…

    But, I would much rather have the four years, and still have time to shake my critter’s tree to get the things that need to be taxed–Pr0n and mortgage lenders, for instance–than having something that will eventually come back to bite your revenue stream in the ass. IMO

  13. 13
    TenguPhule says:

    No one likes paying taxes, but there’s no logic to this, unless you count the idea that all taxes on anything anywhere at any time are baaaad, as logic.

    Enforcement comes to mind. World Wide Web isn’t just there for show.

  14. 14
    Cabalamat says:

    Nancy Irving:

    It’s not as if it’s a struggling industry. In fact, many industries that are taxed are struggling because of the internet. No one likes paying taxes, but there’s no logic to this, unless you count the idea that all taxes on anything anywhere at any time are baaaad, as logic.

    The Internet shouldn’t be taxed precisely because of the points you make. That is, because (1) the Internet is a sunrise industry not a sunset industry, and (2) much economic activity uses, or is dependent on, the Internet.

    All modern countries need to expand their Internet infrastructure as quickly as possible, in order not to fall behind their competitors; their future prosperity depends on it. In particular, the USA is falling behind countries like South Korea in terms of the availability, cost and speed of broadband access, and taxing the Internet would only make that worse.

    Thus taxing the net would be a bloody stupid thing for lawmakers to do. Taxing applications such as VoIP would also be stupid, for the same reasons.

  15. 15
    Kirk says:

    The Law of Unintended Consequences is the largest reason why the internet shouldn’t be taxed. Here’s the trip:

    Generally, everyone agrees that the sales taxes should be collected by the seller and given to the seller’s state (and where applicable county and municipality) of tax authority. It’s reasonable, and the mechanisms are already in place.

    UC1: Business relocation. The current tax exemption that drives business location is property taxes. But there’s a huge marketing benefit to saving a few percentage points on “sales price”. Note that due to various corporate laws it’s not necessary for the business itself to move, just for it to do enough to incorporate (or otherwise satisfy obligations) in the appropriate location.

    UC2: Impact on International business. Our goods sold outside the borders of the nation are now at a competitive disadvantage due to tax collection. And people looking for nominally equivalent goods will balance tax vs shipping costs – cutting into “buy from home” sources.

    UC3: Ebay (and ebay type) sales. Should Ebay collect based upon (alleged) location of seller, or of its own location? Or should it “simply” require that the seller be responsible – it is, after all, not selling the goods but only providing a common marketplace.

    These are not insurmountable, but they are potentially significant. And I’ve only scraped the surface of the issues.

  16. 16
    Zifnab says:

    These are not insurmountable, but they are potentially significant. And I’ve only scraped the surface of the issues.

    These are problems to be tackled, not consequences. The E-bay example is the most shining. People have whole cottage industries built off of E-bay. How do they get to dodge sales tax when Joe Storefront Saleman still needs to pony up?

    What’s more, low sales taxes are often used to lure business to poorer states. Why set up office in Arkansas when you can use all the services of New York and never pay for them, dodging sales tax?

    Should the internet exempt people from tariffs and other trade barriers as well? What makes the internet so special?

    I can understand the argument that taxing internet access raises the cost of having a connection which discourages business. But, at the same time, I’ve never looked at my telephone bill and bemoaned the cost of the telephone tax. Are telephones somehow so different from internet connections that a surtax on the monthly access fee would destroy business? Didn’t ARPNET originate from the US Government? Don’t we want to continue to fund that kind of research?

Comments are closed.