NCPA - National Center for Policy Analysis


July 3, 2007

Passage of the Permanent Internet Tax Freedom Act of 2007 -- to permanently prohibit state and local taxes on Internet access and commerce -- would provide the crucial first step needed to ensure that Internet access is not subject to discriminatory taxes that would limit consumer choice, hurt innovation and undermine our global competitiveness, says Jack Kemp, former congressman and Housing and Urban Development secretary, and Cesar Conda, formerly a domestic policy adviser to Vice President Dick Cheney and a policy research consultant for telecommunications industry clients.

Consider the consequences of such a tax:

  • Without permanence, state and local governments could soon view booming Internet access and commerce trends as an easy target for additional tax revenues to fund expanded state and local spending.
  • This potential is especially alarming given the high level of taxes already imposed on other communication services across the board, particularly wireless service.

At a time when technology across the country is developing and becoming more accessible to Americans of all walks of life, it would be terrible for Congress to ignore a measure that would clearly serve to further increase our deployment of high-speed Internet technology and usage by anyone who chooses to do so, say Kemp and Conda.

If the current Internet tax moratorium were to expire, we'd likely see a tremendous slowdown in the next generation of high-speed Internet, wireless phones and mobile communications.  For the sake of continued economic growth and innovation, Congress must keep the Internet permanently tax-free, say Kemp and Conda.

Source: Jack Kemp and Cesar Conda, "Place Internet In Permanent Tax-Free Zone," Investor's Business Daily, July 2, 2007.


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