President Bush signs Internet tax moratorium into law

“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.

25 Comments

  1. Internet companies don’t have to pay property taxes or rent, and their employee costs should be lower than bricks-and-mortar stores. So why should they also get a sales-tax break?

    If they can’t compete on merit, they shouldn’t compete, according to the laissez-faire capitalists, like Bush claims to be. Face it, conservatives, Bush is a don’t-tax-and-spend-anyway fiscal moron.

  2. Umm, cat person, your feline instincts betray you. All companies have to pay local property taxes and either a mortgate on the building or rent. Furthermore, they aren’t getting a sales-tax break, the customers are. Sales taxes are added to the amount payed by consumers not included in the amount.

    Who’s the moron now?

  3. bush is still scum. he he really was serious about cutting taxes for the long term and not just while he was in office, he’d cut the crazy spending being done by the Republican congress.

    And there is nothing new here. Just continuing another moratorium on taxes left over from the Clinton days.

  4. hillbilly, I’m not a fan of taxes but it seems to me that taxes pay for all sorts of various public programs such as fire, police, military, public education, medicare, homeless programs, government sponsored research, etc, etc, etc. Yes there is allot of pork in our government spending and yes the rich pays more than the poor, but the poor are poor for a reason because they don’t have any money. Now would you like to shift it so that the poor pay more taxes than the rich fine but you would be then making the poor, poorer when they desperately need that money to survive. Now to a guy who makes 200K+ a year what is an increase of 5% of taxes oh say 10K but that wont her him more than an increase of 5% in taxes to someone who makes 10K a year. Sure its 500 but that 500 could go to food, clothing or other basic necessities that they are desperate for. So hey lets make life harder for those who are desperate while allowing the rich to go vacation in Aspen/Arauba/Barbados/France/etc. Whatever happened to helping those who are less fortunate than you?

  5. Personally I think the majority of tax breaks should go to the mid to lower half of the spectrum. They actually spend most of the money they make so it will stimulate the economy more than giving tax breaks to the ultrarich.

  6. Johnny B:
    “the poor are poor for a reason because they don’t have any money.”

    1. Caution, the poor have money, just less than the rich. Who is poor and who is rich is somewhat subjective anyway. People that determine these things often are the same ones that want to raise taxes on the rich so they can spend that money on “helping the poor.”

    There is nothing noble about taking someone else’s money and giving it to another person. Which leads to the next point:

    “a guy who makes 200K+ a year what is an increase of 5% of taxes oh say 10K but…”

    2. This sort of rationalization explains why we raise taxes on the so called rich early and often. But it undermines the engine that drives an economy.

    Look, someone making 200k a year either works in a highly skilled position such as a surgeon or lawyer, or he’s in business for himself. Someone who owns a business tends to hire more and more people as their business grows. When you raise taxes on them by 5%, you often cut far more deeply into their proffits than the 5% tax hike. Someone working in that business gets fired. So you are hurting the poor.

    For that matter, why should not a poor person also pay a share in fire, police, defence, etc.? Are they not benefitting too? Having poor not pay taxes is exactly why they are so eager to tax the rich, they don’t realize how corrosive that punative taxes are. They don’t pay them, so it doesn’t effect them.

    “lets make life harder for those who are desperate while allowing the rich to go vacation”

    3. No, lets make everyone have a stake in society. Many government run programs designed to help the poor are a form of subsistence slavery. Subsidized housing where the poor never own anything is a prime example. Lets keep someone who is poor completely dependant on the government for handouts from here to eternity. Never let them own anything. I for one would rather encourage ownership in things, homes, stocks, savings accounts, etc. Nearly every government attempt at helping the “poor” discourages and punishes these things.

    Which birngs me to the last point:

    “Whatever happened to helping those who are less fortunate than you?”

    4. What happened is the government is NOT the place to do it. It’s a miserable abject failure at helping the poor, unless you think by helping they should mean to help keep them poor and dependent. I would like to think that it’s better to educate people and help them become more independent and take ownership and control over their lives and not need government assistance. Those that really need help are likewise often better served by charities where the money can be more carefully monitored than government handout money can. Also, people are inherently lazy, so if you provide them with an endless supply of free goodies without them having to earn them they will take advantage of that, and not learn to depend on themselves for their needs. That’s not doing them a favor, that’s encouraging them to stop being useful and productive. That is cruel.

    I reject the notion that an impersonal bureaucracy (the government) cares anything about the poor. If they really did, then why are government programs not judged by their results? The goals should be teaching and encouraging self reliance, wealth building and managing money, education and training, and other empowering ideals. Assistance programs should be considered abject failures if all they produce is endless lines of dependent souls.

  7. Being from Massachusetts I know the pain of high taxes and the avoidance of getting ripped off from high rent, mortgages and bloated shopping mall retail prices. I think about leaving the state every day. The only thing that keeps me here is a steady good paying job. For Internet companies to remain competitive and healthy there should be no Internet taxes. We will continue to be taxed simply because we have not collectivly stepped up to the plate to question and vote down these tax laws. We ALL must do our part to make sure our voice is herd by local, state and government officials. Only through persistance will we succeed in keeping the Internet free from taxes and other invasive and possibly devistating economic acts.

  8. umm – let’s not get into a political debate here guys, because, frankly, you missed the point of the story. you are still going to have to pay sales tax at certain online stores (like apple.com). any internet site taht also has a physical store in the us MUST charge sales tax on online sales. what this article was referring to was a tax on actual internet access. for example, if you use earthlink, and pay $25 per month, you would have a tax on that. what the govt did was extend a moratorium on taht tax, meaning, you don’t pay it now, and you still won’t have to pay for it for three more years.

  9. gillon
    “umm – let’s not get into a political debate here guys”

    Sorry if my comments offended you. Did not intend to do so.

    “because, frankly, you missed the point of the story.”

    Nope, I got the point of the story, was responding to someone’s remarks (Johnny B).

    “you are still going to have to pay sales tax at certain online stores”

    Not against taxes, especially not sales taxes. I think sales taxes are very fair (as long as they don’t especially target a certain product like cigarettes). Only against the government feeling it needs to collect every last drop of blood from it’s citizens so it can spend their money for them. Keep taxes (and sales taxes) at a moderate level and I’m right there.

  10. “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.”

    What states are already collecting taxes on Internet access? (and will be doing so for the next four years?)

    I must remember to NEVER move there!!!

  11. what idiot wants to tax the internet? they should tax those yankee juiceheads along with balco barry

    the babe took anti-steroids; he was fat, and wasted but still kicked ass

  12. ANYONE LIVING BELOW THE POVERTY LEVEL SHOULD NOT PAY TAXES. ANNUAL MEDIAN INCOME IS THE AVERAGE WAGE AT WHICH IT TAKES TO LIVE ON JUST TO GET BY (HOUSING. CLOTHES, FOOD AND ALL OTHER NECCESSITIES). I DON’T CARE IF THEY TAX THE RICH AT A RATE OF 99%, THERE 1% LEFT OVER IS STILL MORE THAN I MAKE IN A YEAR. I SUFFER, THEY PAY TAXES AND STILL LIVE IN MILLION DOLLAR HOMES. IF BUSH MADE $20,000/YEAR I WONDER IF HE WOULD BE WILLING TO GIVE UP 3 0R 4 THOUSAND OF THAT IN TAXES. IT TAKES ABOUT $35,000 JUST TO LIVE ON (GET BY MONEY) !!!!!!!

  13. The Dude thinks that there should be a FLAT TAX…. no tax breaks to ANYONE! you pay your flat 15 or 20 %… whatever is deemed the proper amount. nobody gets screwed that way. everyone is created equal…. everyone pays equal. seems simple enough.

    Another thing…. remove the tax free status from everyone but the major support organizations (Red Cross, United Way, ect). Churches should be be tax exempt. (I am a Christian too… so no need to blast me as an atheist.)

    and if our airhead president would get his head out of his arse and cut this spending that is WAY out of control, we would not need to tax the heck out of anyone.

    The Dude abides.

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