E-mail taxes start Saturday

Come Friday midnight, e-mail taxes could become real. Or businesses could
get a
bigger tax break. Or things could stay the same. And you can influence the outcome.

If nothing is done in Congress by Friday midnight, the 1998 Internet Tax Freedom
Act expires and the Internet becomes fair game for the feds, states, counties,
cities and just about any other taxing authority know to man.
Here's how the Wall Street Journal, friend of business, talks about the situation:

"You will double-up the price of plain old Internet access faster than
a dog can jump on a meat wagon," predicted Senator Wyden last week. But
that's just the beginning. With no law to stop them, state and local officials
can start taxing everything from spam filters to instant messages to Google
searches. E-mail taxes alone would be a gold mine for free-spending politicians
across the country. At a Senate hearing on spam in May, Minnesota Democrat
Mark Dayton suggested "looking at some very, very small charge for
every e-mail sent."

He's not alone. States and cities love the idea, and not just because of
the potential for taxing, say, cross-country e-mails. Governors, mayors
and county
officials are thinking locally, too. A message sent by you to your neighbor
per next Saturday's barbecue might easily pass through computer servers
located in several of the nation's 7,600 different taxing jurisdictions. [Taxing
Your E-Mail] [requires subscription]

Senator George Allen, Virginia Republican defends
his bill (he would, wouldn't he) even if the best thing about it
is the name (Internet Tax Nondiscrimination Act).

Okay, so that's the scare from business and those who get those juicy campaign
contributions. They want the new Senate bill passed not because what it
will save you, but because it gives them even more tax breaks
and contributions, by reclassifying cable companies as "Internet services."

Local municipalities and several watchdog organizations nationwide are lobbying
to patch what they claim is a billion-dollar loophole in the proposed Internet
Tax Nondiscrimination Act of 2003.

The act is an amendment to the Internet Tax Freedom Act, which bans taxes
on Internet services.

Municipalities and watchdog groups fear the language of the new act would
free cable and telecommunication companies from paying franchise fees for
the use of the public rights-of-way to install cable or fiber optic systems.

AT&T, Sprint, SBC, MCI, EarthLink and Comcast are some of the major
companies in the area that provide phone, cable and Internet services.

If a company is classified as a telecommunications service, it is subject
to regulation and, therefore, fees. If considered an Internet or information
service, it is pardoned of such regulation under the Internet Tax Freedom
Act. [Cable firm or telecom?]

Article Author: Hal Pawluk

Visit Hal Pawluk's author page — Hal Pawluk's Blog