“President George Bush on Friday signed into law a three-year moratorium on Internet access taxes. The law extends a ban on Internet taxes that expired on November 1, 2003. The original version of the Internet Tax Nondiscrimination Act, passed by the House of Representatives in September 2003, would have permanently extended a five-year congressional moratorium on taxes unique to the Internet, including taxes on access and bandwidth,” Grant Gross reports for IDG News Service.
“But the bill was held up in the Senate over concerns that it would allow telecommunications carriers to avoid taxes on traditional telephone service as they move traffic to Voice over Internet Protocol services. A compromise version crafted in the Senate and approved by the House last month allows states and cities to continue to collect taxes on telephone services, even if the calls are made over the Internet,” Gross reports. “The compromise version of the bill also allows states already collecting taxes on Internet access to continue to do so for up to four years.”
Full article here.