Focus Point - Taxing the Net

Commentary by Pete du Pont

I'm Pete du Pont with the National Center for Policy Analysis. The battle to keep Internet commerce tax free won a small victory last week when a Blue Ribbon Commission voted to extend the moratorium on Internet taxes until 2006.

The Advisory Committee on Electronic Commerce, appointed by Congress in 1998, has held hearings around the country. They voted 11-1 with seven abstentions against collecting taxes on e-commerce. It was only a small victory because a two-thirds majority is needed for a formal recommendation, and the administration's appointees kept abstaining. But it gives you an idea where things seem to be headed.

State and local governments are flush with money, and because so many things are exempt from sales taxes, what they did get from taxing the net would be a pittance. The panel also agreed Internet access shouldn't be taxed, and that the last thing business needs is the headache of collecting yet another tax. There are already 7500 sales taxes collected across 30,000 jurisdictions.

Common sense could be winning this one, but where money is concerned, you always keep your fingers crossed.

Those are my ideas, and at the NCPA we know ideas can change the world. I'm Pete du Pont. Next time, a gun to their head.