Senator Wyden added, “Putting new, unfair Internet taxes on the backs of consumers is not the way to fix state and local budget troubles.”

Legislation Introduced to Extend Internet Tax Moratorium, PERMANENTLY!

On January 7, the first day of the 108th Congress, Representative Christopher Cox (R-CA) and Senator Ron Wyden (D-OR) introduced companion legislation (The Internet Tax Nondiscrimination Act) that, if passed, will make permanent the Internet tax moratorium.

Representative Cox and Senator Wyden authored the original moratorium passed by Congress in 1998 which bans multiple and discriminatory taxes on purchases made on the Internet and taxes levied at Internet access.  “Since 1998, when the Cox-Wyden bill first became law, we have had ample time to evaluate the effects of the moratorium on Internet taxes – on the growth of the online economy in general and e-commerce in particular,” said Representative Cox.  “Given the continued softness of the tech economy, this is hardly the time for new taxes on the Internet.  Rather, providing long-term certainty about tax policy is one of the necessary ingredients for a tech rebound.”

Senator Wyden added, “Putting new, unfair Internet taxes on the backs of consumers is not the way to fix state and local budget troubles.”

Ironically, introduction of the Internet Tax Freedom Act comes after recent reports that many of the nation’s governors, state legislators and state tax collectors are putting the final touches on a plan to shift their tax collection burden to out-of-state merchants, something currently prohibited without Congress’ approval under the Supreme Court’s Quill decision. 

While the controversial tax collection issue, euphemistically labeled “simplification,” is completely separate from the moratorium, efforts will again be made to tie the two together.  Such efforts were the primary reason why the moratorium wasn’t made permanent in 2001 when Congress extended it for two years. 

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