Net Tax Ban Clears First Hurdle

Your monthly cable and DSL bill could jump 17 percent when a four year tax moratorium on the services lifts November 1. However, a Net access tax could be averted if some lawmakers have their way. They want to ban a tax on Internet access for another four to eight years ? or better yet make it a permanent ban.

On Wednesday the U.S. House of Representatives Judiciary Committee voted unanimously to extend the existing four year ban on taxing Internet access. Lawmakers in the in the Senate Energy and Commerce Committee have also been considering extending the tax ban or making it permanent. The National Governors Association reportedly backs the four-year extension as well.

The bill (H.R. 3678) to ban Net taxes now goes to the House for a full vote.

The measure to ban taxing Internet access has the support of Comcast and Verizon and Web firms such as Google. These companies have backed public interest groups such as Don't Tax Our Web who claim if the tax ban is lifted monthly broadband fees could rise nearly 20 percent for consumers.

With so much support from lawmakers, private industry, and the public it seems inevitable the Internet Tax Freedom Act (ITFA) will be extended for another four years. The ITFA was enacted in 1998 and was renewed in 2001 and 2004. An extension of the bill this time around would likely extend the moratorium on Net taxes until 2011. However, it remains to be seen if lawmakers have enough support to make the bill permanent.

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