ITFA Lives to Fight Another Day

ITFA Lives to Fight Another Day

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As the holiday gift that keeps on giving, the Cromnibus, passed in the final hours of the 113th Congress, once again extended the moratorium on Internet access taxes for another year.  Though a permanent solution has yet to be adopted, the Internet Tax Freedom Act will now be in effect until October 1, 2015.  This is the fourth extension since the bill was first passed in 1998, and failure to extend it could have resulted in immediate negative financial consequences to Internet users across the country:

If Congress had failed to extend the tax moratorium, several states would have moved quickly to levy taxes on Internet access and other services, said Senator Ron Wyden, an Oregon Democrat and long-time sponsor of the moratorium legislation.

“A fair and open Internet is an engine of economic growth in America, a launching pad for entrepreneurs and history’s most powerful tool of communication,” Wyden said in a statement. “By extending this bill, the Congress has, for the short term, ensured that this long-standing policy keeps Internet access tax-free.”

The Internet Tax Freedom Act, which bans state and local governments from taxing Internet access, was set to expire in November, but the original deadline was pushed to December 11 as Congress sorted through the logistics of our national spending bill.  While The House of Representatives passed ITFA in July, the Senate did not reach agreement on the bill until Saturday, December 13th.  President Obama signed the Cromnibus in to law on Tuesday, December 16th.

The current extension is only a temporary fix, and pushes ultimate resolution of the Internet access tax question on the hands of the 114th Congress, who will also likely tackle online sales tax. With price sensitivity being a driving concern for economically vulnerable populations and people who have yet to adopt the latest technologies in their homes, the prospect of an Internet access tax is particularly worrisome.  Making sure that all Americans have access to affordable technology should be a trop priority for Congress in this digital age.  As such, the new Congress should alleviate future barriers to broadband adoption by ensuring that Internet access taxes are permanently banned through passage of a permanent moratorium on Internet access fees.

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