WASHINGTON — Following a clarion call by Rep. Chris Cannon, the House passed a bill Wednesday to ban taxing Internet services.
"Today is a historic day," said Cannon, R-Utah, who as chairman of the House Judiciary Subcommittee on Commercial and Administrative Law has fought hard to prevent taxes on access to the Internet. The House twice in previous years passed temporary moratoriums on them. The new ban would make the ban per- manent.
"This bill would broaden access to the Internet, expand consumer choice, promote certainty and growth in the IT sector of our economy, and encourage the deployment of broadband services at lower prices," Cannon told the House.
The bill, sponsored by Rep. Christopher Cox, R-Calif., passed on a voice vote and now goes to the Senate.
Cox, Cannon and Rep. Mel Watt, D-N.C., the ranking Democrat on Cannon's subcommittee, pushed for the permanent ban especially because some states had started trying to tax digital subscriber line or broadband connections to the Internet.
Cannon said temporary tax bans have helped the Internet blossom and made obtaining access more affordable.
The bill does not address the complicated issue of collecting sales taxes on goods sold over the Internet.
Cannon announced that his subcommittee has scheduled a hearing on efforts by states to allow that — and whether Congress should approve needed interstate compacts for it — on Oct. 1 "in order to give members an opportunity to examine it fully."
While buyers technically owe sales tax on anything they buy, Internet vendors are generally not forced by law to collect them and leave it to individual consumers to pay the tax themselves to their states. Few do that. States are seeking ways to simplify the sales tax system nationally to allow Internet collection of those sales taxes.