Although there has been comparatively little fanfare, the House tomorrow takes up a bill that would make the current ban on taxing the internet permanent.
It is almost impossible to overstate the importance of this bill for the economy and internet uses (which is just about everybody these days).
The internet has been the great economic success story of our time, allowing entrepreneurs with almost no capital to launch businesses, and enabling unprecedented freedom and opportunity for communicators. One of the reasons for this is the Internet Tax Freedom Act of the early 1990s.
The Permanent Internet Tax Freedom Act is set to expire if Congress doesn’t make it permanent and, as you can imagine, greedy state and local government entities are licking their chops at the idea that the bill could expire.
If the internet is taxed, this segment of the economy might become as stagnant as other highly-taxed and regulated sectors. In explaining why this is so important, I can do no better than to quote from an article by Amy McLean that appeared a year ago on MyWireless.org:
In a paper [that was released in June of 2014],by The Phoenix Center, Dr. George S. Ford estimates that allowing state and localities to levy communications taxes on Internet connections will have a “sizeable adverse effect on broadband adoption, likely erasing all reasonable estimates of the gains to Internet adoption from the billions of dollars spent to date on federal, state and private-sector programs.”
Translated: State and local taxes will lead to giant steps backwards from where we are today with so many Americans relying on Internet access to run their businesses, do their homework, monitor their health, find jobs, etc.
The Organisation for Economic Co-operation and Development (OECD) is an international group that’s reporting the U.S. mobile broadband penetration rate is 96% (299 million active mobile units). Dr. Ford estimates that if ITFA is not extended, there is a “plausible loss” of 30 million wireless lines, and the U.S. would drop from 7th in the world in mobile broadband penetration to 9th – putting us behind Estonia and Norway.
The bill is scheduled to come up tomorrow (June 9).