40 senators push long-term ban on Internet tax

Bipartisan leaders in the Senate are pushing for a long-term ban on state and local taxation of Internet access. 

Senate Commerce Committee Chairman John Thune (R-S.D.) and the ranking Democrat on the Finance Committee, Sen. Ron Wyden (Ore.), reintroduced the Internet Tax Freedom Forever Act on Tuesday along with 38 co-sponsors — 28 Republicans and 10 Democrats.

The bill, which would also bar multiple or discriminatory taxes on e-commerce, has wide support from industry. 

“Our bill, which would permanently ban Internet taxation, would encourage more American innovators and entrepreneurs to use broadband to develop the next big thing, while keeping the Internet open and accessible to consumers across the country,” Thune said in a statement. 

Wyden warned that consumers could be charged hundreds of dollars a year in new taxes if the law was not extended, arguing, “Now is the time to make this law permanent.”

The ban has been extended nearly half a dozen times since first enacted in 1998. The most recent came last year, when Congress rolled a one-year extension into the omnibus spending bill. 

But lawmakers want to remove the sunset date for a future extension. House Judiciary Chairman Bob Goodlatte (R-Va.) reintroduced similar legislation in the House last month.  

It passed the House last year, but got sidetracked in the Senate. 

Some lawmakers last year attempted to tie a long-term extension to a more contentious proposal that would allow states to collect online sales tax from purchases made anywhere in the country. The proposal was sponsored by Republican Sen. Mike Enzi (Wyo.), the current Budget chairman, but ran into resistance in the House. Wyden has fiercely opposed the measure.  

The tax ban has also made an appearance in the simmering debate about net neutrality. Advocates point to it as evidence that reclassifying broadband Internet as a telecommunication service will not saddle consumers with higher fees. But Republican member of the Federal Communications Commission Ajit Pai said there are ways around it. 

“Aside from that act, which relates to taxes on Internet access, this order explicitly leaves the door open for the imposition for an array of federal and state taxes and fees on broadband,” he said at a press conference Tuesday. “Ultimately, those are going to be passed along to consumers completely independent of the act.”