W Internet Taxation

Welcome to the Center’s campaign to keep the Internet free from new and discriminatory taxes. This section provides you with an in-depth analysis of the debate over Internet taxation, complete with a detailed background of the issue, and the Center’s activities. We also provide you with the ability to communicate with your elected officials in Washington.

Recent DevelopmentsCenter's ActivitiesBackground
From our Side
Legislation in the 108th Congress
In Their Own Words
Contact Congress

Recent Developments INDEX

CFIF Urges Senate to Pass a Clean and Permanent Extension of the Internet Tax Moratorium

In an open letter to the United States Senate, the Center for Individual Freedom this week joined other national organizations in urging swift consideration of S. 156, the Permanent Internet Tax Freedom Act...[more]

U.S. House Temporarily Extends Internet Tax Moratorium, Misses Opportunity to Make it Permanent

The U.S. House of Representatives this week overwhelmingly passed a four-year extension to the moratorium that prevents states and localities from taxing Internet access...[more]

CFIF Joins Coalition in Urging Extension of Internet Tax Moratorium

With the current Internet tax moratorium set to expire on November 1, 2007, the Center for Individual (CFIF) this week joined more than 35 national and state organizations, representing millions of taxpayers, in urging Congress to make permanent the Internet Tax Freedom Act...[more]

The World Wide (Tax) Web

By Senator George Allen: The growth of the Internet over the past 10 years has provided greater opportunity for everyone — from the largest multinational corporation to the smallest mom-and-pop start-up business. By giving more people access to knowledge and information, the personal computer and the Internet have empowered tens of millions of Americans as consumers and entrepreneurs, and as citizens in our free society...[more]

Accessing the Internet

By Senator George Allen: The Senate will soon vote on The Internet Tax Nondiscrimination Act (S. 150), my bill that permanently prohibits taxes on a consumer's ability to access the Internet. This law should and must pass to advance Internet access and digital opportunity for all people in the United States...[more]

House Moves to Make Internet Tax Moratorium Permanent

Legislation to make permanent the Internet tax moratorium originally passed by Congress in 1998 cleared its first hurdle in the U.S. House of Representatives last week.  The House Judiciary Commercial and Administrative Law Subcommittee approved by voice vote H.R. 49, the Internet Tax Nondiscrimination Act, sponsored by Representative Chris Cox (R-CA).  The current moratorium is set to expire in November…[more]

Keep Internet Tax Issues Separate

By U.S. Senator George Allen: (Reprinted with permission from Roll Call) In the Fall of 2001, the Senate extended by two years a moratorium on Internet-access taxes — monthly fees imposed in addition to your Internet service provider bill.  At the same time, we extended a moratorium on taxes that discriminate against the Internet as a form of commerce.  However, what should have been an uncontroversial moratorium was temporarily held hostage because some wanted to chainlink it to much more controversial and complex issues regarding how to collect and remit taxes on purchases made on the Internet. To download the complete story, click here.

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...[more]

States Vote to Streamline Collection of Internet Sales Taxes

A coalition of lawmakers and tax collectors from more than 30 states gathered together in Chicago on November 12 to approve the final draft of an interstate agreement to "simplify" their tax laws and make it easier for budget-strapped legislators to collect sales and use taxes on Internet purchases...[more]

States Clamoring to Tax E-Commerce (Again!)

As state budgets dwindle, due in part to the nation’s lingering economic slump, Governors around the country are once again chomping at the bit to fill state coffers with tax money collected from e-commerce. However, they argue it’s a difficult task; one they hope Congress might make a little easier -- and more popular -- for them...[more]


From our SideINDEX

"Simplification" Is Not the Easy Answer

The Internet tax moratorium is set to expire in October, and the debate over its extension is being clouded by a coalition of states that fear an eroded tax base, as more consumers shop online. Some of these states are in the process of enacting model legislation that includes a "simplified and streamlined" sales tax system with the hopes of getting congressional approval to force remote merchants to collect and remit sales taxes on purchases made by their citizens...But the "simplifications" ...are anything but simple... [more]

Commerce Clause in Cyberspace

In a world without borders, the Internet facilitates an explosion of online retail opportunities, as more commerce is moving onto the Internet. Despite the borderless nature of the Internet, hundreds of laws concerning the Internet and e-commerce have been passed over the last few years. This patchwork of state, national and international laws and regulations threaten continued growth of e-commerce. Many of these statutes on their face discriminate against out-of-state commerce and place a burdensome "chilling effect" on interstate and international e-commerce. The problems facing e-commerce suggest the extreme need for a cautious approach to state and national regulation of commercial Internet activity. [more] [BACK TO TOP]

Center's ActivitiesINDEX

CFIF Urges Congress to Make Internet Tax Moratorium Permanent

In a letter to all members of the U.S. House of Representatives and U.S. Senate, the Center for Individual Freedom (CFIF) this week joined more than two dozen state and national free-market organizations in urging Congress to make permanent the current moratorium on Internet taxes...[more] 

Center Supports Permanent Internet Tax Moratorium

With the Internet Tax Moratorium set to expire on November 1, the Center for Individual Freedom today applauded the Senate Commerce Committee for holding a hearing on two pieces of legislation — S. 52, sponsored by Senator Ron Wyden (D-OR), and S. 150, sponsored by Senator George Allen (R-VA) — that would make permanent the ban on multiple and discriminatory e-commerce taxes and Internet access taxes...[more]

Center Expresses Strong Support for Making Permanent Internet Tax Moratorium

In a letter to Senator George Allen (R-VA), the Center expressed strong support for his legislation to make permanent the moratorium on multiple and discriminatory taxes on electronic commerce and taxes on Internet access.  Furthermore, the Center applauds his efforts to repeal current taxes on Internet access in those states that were grandfathered when Congress originally passed the Internet Tax Freedom Act in 1998.

To read the Center's letter, click here.



Internet Tax Freedom Act In 1998, Congress passed the Internet Tax Freedom Act, which prohibits Internet access taxes, multiple taxation of a single transaction by more than on taxing jurisdiction, and discriminatory taxes that do not apply to offline purchases. To view a copy of the law, click here.
Advisory Commission on Electronic Commerce’s Report to Congress

The Advisory Commission on Electronic Commerce, authorized by the Internet Tax Freedom Act of 1998, was created to study federal, state, local and international taxation and tariffs on transactions using the Internet and Internet access. To read the commission’s findings and recommendations to Congress, click here. Quill Corp. v. North Dakota In 1992, the Supreme Court ruled in Quill Corp. v. North Dakota that states, without permission from Congress, cannot require out-of-state retailers to collect and remit sales taxes unless the retailer has a substantial physical presence or "nexus" in the state. To read the decision, click here. [BACK TO TOP]

Legislation in the 108th CongressINDEX

House of Representatives
H.R. 49 Internet Tax Nondiscrimination Act
Sponsored by Representative Christopher Cox (R-CA), H.R. 49 would make permanent the Internet tax moratorium originally passed by Congress in 1998.

H.R. 1481 Internet Growth and Freedom Act of 2003
Sponsored by Representative Zoe Lofgren (D-CA), H.R. 1481 extends for an additional five years the Internet Tax Freedom Act originally passed by Congress in 1998.

S. 52 Internet Tax Nondiscrimination Act
Sponsored by Senator Ron Wyden (D-OR), S. 52 would make permanent the Internet tax moratorium originally passed by Congress in 1998.

S. 150 Internet Tax Non-discrimination Act of 2003
Sponsored by Senator George Allen (R-VA), S.150 would make permanent the Internet tax moratorium and repeal current taxes on Internet access in those states that were grandfathered when Congress originally passed the Internet Tax Freedom Act in 1998.



In Their Own WordsINDEX

"The debate over the taxation of the Internet isn’t about feeding the already well-lined coffers of government. It’s about the fundamentally American idea that there should be no taxation without representation.

"While there is no evidence that Main Street firms have lost business due to tax differentials, that is beside the point. The answer to these concerns should not be to raise taxes on the Internet, but to lower taxes on Main Street businesses."

Colorado Governor Bill Owens
In a letter to Congress urging the extension of the Internet tax moratorium, and opposing his fellow governors’ plea for Congressional approval to force collection of sales and use taxes from remote businesses.
August 20, 2001

"I am in favor of extending the Internet tax moratorium in Washington. The changes are so rapid in technology, whether it’s the Internet or e-commerce, and for governments to try to get in front of that with a tax policy I think is just not sound policy.”

New York Governor George Pataki
Inside Politics
August 17, 2001

“In the New Economy, what’s moving is the Internet, and, unfortunately, government’s 20th Century impulse is to tax it. But government’s 20th Century impulses, if not checked by Congress, would stop the Internet dead in its tracks. The risk is real and, if the Internet is to achieve its full potential, governments must curb their insatiable appetites for more tax dollars.”

Virginia Governor James Gilmore
Testimony before the House Subcommittee
on Commercial and Administrative Law
July 26, 2001

“I am deeply concerned that a tax on the Internet will serve to hinder growth in this important sector at the time when it could least afford it. The proper role of government in this emerging industry is to encourage its growth. It would be a grave mistake on our part to start taxing Internet commerce before it has even had a chance to establish itself.”

Massachusetts Governor Jane Swift
“Opposing Taxation of Internet Commerce”
Testimony before U.S. Senate Committee
on Commerce, Science and Transportation
March 14, 2001

“Today, as the end date for the moratorium draws near, and as capitol has been diverted from firms pursuing Internet development, it is more critical than ever to renew the Internet tax moratorium, and to assure all Americans that government will not place special burdens on the new economy.”

U.S. Rep. Christopher Cox (R-California)
Testimony before the House Subcommittee
on Commercial and Administrative Law
July 26, 2001

“We must continue to ensure that the Internet remains free from restrictive taxation by making the tax moratorium permanent.”

U.S. Rep. Bob Goodlatte (R-Virginia)
On the introduction of H.R. 2526,
Internet Tax Fairness Act
July, 17, 2001

“In my view, the Internet has the most profound liberating potential since Gutenberg’s invention of the printing press, which allowed the mass distribution of ideas, thoughts and information. This legislation is a step forward to keeping the Internet free of unfair, discriminatory taxation policies that would impede its future growth as a source of commerce, education and information.”

U.S. Senator George Allen (R-Virginia)
On the introduction of S. 777,
Internet Tax Nondiscrimination Act
April 26, 2001

“The Internet has produced a new arena of commercial activity, primarily because it has been free of most taxes and regulations. It should stay that way.”

Las Vegas Review-Journal
August 3, 2001


Contact CongressINDEX

Write your elected officials TODAY!
Tell them to say NO to new Internet taxes.

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