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US Lawmakers Push For a Permanent Ban On Internet Access Taxes 100

jfruh (300774) writes Since 1998, U.S. law has forbidden states from taxing Internet access — but the law has an expiration date that's been extended five times now. The new Congress is attempting to make the ban permanent, but some members are objecting to the fact that the proposed bill leaves in place grandfather clauses for states like Texas and Ohio that already had taxes in place in 1998.
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US Lawmakers Push For a Permanent Ban On Internet Access Taxes

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  • Later law automagically overrides, so a law cannot make anything permanent.

    All it'll take is a new law allowing/mandating internet access taxes to make this "permanent" ban vanish.

    • by ShanghaiBill ( 739463 ) on Sunday January 11, 2015 @07:18PM (#48789643)

      Later law automagically overrides, so a law cannot make anything permanent.

      It is obvious that by "permanent" they mean a law without an automatic expiration date. It is much easier to let a law expire than to pass a new law, especially with the 60 vote threshold in the Senate. There is a huge bias toward inertia.

      Although I agree in principle that Internet access is a dumb thing to tax, I disagree even more with the Feds telling the states what to do. If people want to elect legislators that tax their Internet access, that should be their right.

      • by Anonymous Coward on Sunday January 11, 2015 @07:44PM (#48789739)

        The problem with that is the internet is a major avenue of interstate, and even international trade, making it well within the federal bailiwick. Thus the federal government is within its authority to regulate commerce by forbidding or allowing taxation.

        • by quenda ( 644621 )

          The problem with that is the internet is a major avenue of interstate, and even international trade,

          That doesn't make any sense. The states are not taxing passing traffic - they're not building toll-gates on the interstate.
          The tax they want to ban is an access tax - more like a local car registration tax to pay for local road building.

          Dumb idea, but none of the fed's business.

          • by quenda ( 644621 ) on Monday January 12, 2015 @01:50AM (#48790935)

            Wait a minute! You mean this is just about exempting ISP fees from normal sales tax ? Why?
            I thought it must have been some kind of special levy. Most of the developed world has moved away from sales tax to a broad-based "good and services" tax (GST or VAT), as goods have become a much smaller part of our spending than in the past.

                Any exemption (almost) is a dumb idea from an economics view, as it distorts the market and increases the cost of compliance and collection.
            Even exempting food is a bad idea. (Better to increase benefits etc to compensate the poor.)

            The US tax system is a shambles with so many of these special-interest exemptions that wealthy individuals and corporations can end up contributing very little tax.

            • Even exempting food is a bad idea. (Better to increase benefits etc to compensate the poor.)

              The problem is, this country is full of politicians (nearly all right-wingers) with hearts as cold as the intergalactic void. They never do anything to make life easier for regular people. Those assholes would starve the poor just so they give the rich another tax break.

              I wish I could move.

              • The funniest thing about your comment is that you don't see the left-wingers doing the exact same thing for a different set of rich people (Hollywood and Wall Street).

            • Even exempting food is a bad idea. (Better to increase benefits etc to compensate the poor.)

              Taking money and then handing it back to them costs more money than just not taking it at all. Money handeling involves losses, both honest and dishonest.

              • by quenda ( 644621 )

                Taking money [VAT] and then handing it back to them costs more money than just not taking it at all.

                Not if it simplifies the tax system and uses existing mechanisms to compensate the poor. (Everyone else is compensated by lower income tax.)

                both honest and dishonest.

                The argument is that partially shifting from income to consumption tax reduces incentive and opportunity for tax-dodging. Too many papers to cite :)

          • It's a tax on a system that profoundly affects interstate commerce, and a great deal of "Internet traffic" and "Internat commerce" are interstate.

      • by bosef1 ( 208943 ) on Sunday January 11, 2015 @08:15PM (#48789881)

        I second that it doesn't seem like a reasonable thing to have the Federal government telling State governments how to tax Internet access. I also agree that it would be a dumb idea for the states to tax the Internet as a money-making device (there's not that much money in it unless you do some ridiculous tax like by the megabyte; it would be easier just to raise the income tax by 0.25% or something like that). I could see some states wanting to set up state-levied universal access fees, but then it would at the state level and better aligned with the individual needs of the states (yay laboratories of Democracy).

        I also agree the AC that it is probably within the Fed's power to tell the States they can or cannot tax the Internet under the Commerce clause. But the Commerce clause is so abused it lets anyone do just about anything; and that's a whole other argument.

        • by ArmoredDragon ( 3450605 ) on Sunday January 11, 2015 @10:11PM (#48790335)

          Normally I'm in favor of states rights, but I think this is a pretty clear cut case of the commerce clause taking precedent. The internet is all about interstate commerce. I mean how often do most people access resources located within their own state? Rarely ever, and practically none of them ONLY use resources in their own state while on the internet. But yeah, other than that, the commerce clause is WAY overused (such as the national 21 year old drinking law.)

          • I'm in N Central Florida and I've regularly seen traceroutes leaving local residential/commericial access, go up to Atlanta, and back down to a local college.

            • I'm in N Central Florida and I've regularly seen traceroutes leaving local residential/commericial access, go up to a NSA-enabled router in Atlanta, and back down to a local college.

              Fixed that for you.

          • I thought the 21 year old drinking law was leveraged on states by the threat of withholding federal highway funds from any state that didn't raise their drinking age. IIRC, they did the same thing with the 55mph speed limit back in the 70's.

            • Exactly. The states could theoretically sue to gain that funding anyways, but because federal highways are theoretically about interstate commerce (because they facilitate interstate travel for commercial trucks,) the federal government can just use the commerce clause as its basis anyways.

        • I also agree that it would be a dumb idea for the states to tax the Internet as a money-making device (there's not that much money in it unless you do some ridiculous tax like by the megabyte; it would be easier just to raise the income tax by 0.25% or something like that).

          Texas, one of the states that taxes Internet access, does not have a state income tax. All state revinue comes from sales tax. (However it includes services as well) We also like it that way, and any politicinas that mention state income tax are shown the door very quickly.

    • by Charliemopps ( 1157495 ) on Sunday January 11, 2015 @07:27PM (#48789675)

      Later law automagically overrides, so a law cannot make anything permanent.

      All it'll take is a new law allowing/mandating internet access taxes to make this "permanent" ban vanish.

      So they have a temporary law, and they want to make it into a permanent law, and you're saying that's meaningless because they could make another law overriding it? Other events that could render this law meaningless: Civil war, Alien invasion, Meteor strike, Solar flare that destroys all electronics overnight.

      eegads, this entire endeavor is meaningless.

    • by The New Guy 2.0 ( 3497907 ) on Sunday January 11, 2015 @07:40PM (#48789719)

      The problem is that the current law has a "sunset provision" that says it's void after a certain date. This is the 6th time renewing this ban has come up for debate because of this. A "permanent law" is a misnomer, because as you state even the Constitution can be edited.

    • by Solandri ( 704621 ) on Sunday January 11, 2015 @07:47PM (#48789753)
      The distinction here is the same as between discretionary and mandatory spending. The former needs to be reauthorized (every year since the budget is renewed every year). The latter continues until/unless the law is changed.

      The tax prohibition is currently the former type - renewed every few years or it would disappear. Those opposed to the ban have to do nothing but use procedural tricks to block the renewal bill from ever getting to the floor to get the ban revoked. This proposal would make it the latter type - the ban continues until/unless the law is changed. More importantly, those opposed to the ban would have to specifically go on the record as drafting, submitting, and voting for legislation revoking the ban. And face the wrath of internet-using citizens come re-election.

      It's hardly meaningless drivel.
    • It's not necessarily drivel. A "permanent" ban means that it will not have to be renewed periodically. It's permanent unless overridden.

    • by PsychoSlashDot ( 207849 ) on Sunday January 11, 2015 @08:08PM (#48789837)

      Later law automagically overrides, so a law cannot make anything permanent.

      All it'll take is a new law allowing/mandating internet access taxes to make this "permanent" ban vanish.

      Thank you. It must totally rile you up that permanent magic marker can be removed with rubbing alcohol or the heat-death of the universe.

      permanent

      /prmnnt/
      adjective
      1. lasting or intended to last or remain unchanged indefinitely.

      indefinite
      /indef()nt/
      adjective
      lasting for an unknown or unstated length of time.

    • The only permanent things in the world are death, taxes, and internet pedantry.

  • by houstonbofh ( 602064 ) on Sunday January 11, 2015 @07:06PM (#48789565)
    I SUPPORT THIS! (as long as you OK my personal exception) Why is it that we all agree that politicians suck, but we keep getting more suckage? If you keep voting for the lesser of two evils, you keep getting evil.
    • Well, but if you don't vote for a lizard, then the wrong lizard might get elected.
      • Well, but if you don't vote for a lizard, then the wrong lizard might get elected.

        My point is that the wrong lizard keeps getting elected anyway.

  • Start calling it the Information Superhighway.
    • They'll then tax the information superhighway even more.

      Early network services like Prodigy, Compuserve, and AOL, had to deal with changing taxes that led to price changes almost monthly. Internet services were given tax breaks (they would have been taxed under normal law, but this law stood up against that) because the government wanted them to grow. Now that the growth is almost complete, it could be time to go back to normal law.

  • No special cases (Score:3, Interesting)

    by Anonymous Coward on Sunday January 11, 2015 @07:28PM (#48789679)

    Although I personally don't want to pay internet access tax and believe that such taxes make it tougher less advantaged folks, by making it permanent we legitimize loopholes for all kind of special interests. Instead, we've got to get rid of the loopholes. We need to be driving towards a simpler system, with a basic income or similar to deal with inequality / poverty. Anything more is up to you.

    • Re: No special cases (Score:1, Informative)

      by Anonymous Coward

      Economists have worked out that the cost of regulations in the US drives the median income down from $113K to $42K, in equivalent purchasing power (ever wonder where the productivity goes?) With all that wealth and the tendency towards charity, you don't need a centrally-planned minimum income (sorry, monetarists) you need way less central planning. It ain't free by a long shot.

      • by endoboy ( 560088 )

        >>Economists have worked out that the cost of regulations in the US drives the median income down from $113K to $42K

        wow..... "citation needed", as they say in wiki-land

      • by Anonymous Coward

        First: Citation absolutely required.

        Second: How much would the deaths of 1000s of people from E-Coli bacteria drive down the median income for those families? Can I start my own nuclear plant in your unregulated economy?

        Why is it that these 'regulations cost' people never present the costs of the alternative? Ie, what is the cost of completely unregulated markets?

        What is the median income in Somalia? They have a pretty unregulated economy.

    • Instead, we've got to get rid of the loopholes.

      One of those loopholes is for states with no income tax, but a VAT on all spending. (This is known to subsidise inventment and saving) From that point of view, the desire is to eliminate the loophole allowing that spending to be untaxed.

  • by Ol Olsoc ( 1175323 ) on Sunday January 11, 2015 @08:50PM (#48790055)
    Ohio and especially Texas, will complain that the federal guvmnt is interfering in their rights.

    To tax people.

    Texas taxing internet access? Wat is that?

    • by raymorris ( 2726007 ) on Sunday January 11, 2015 @09:27PM (#48790197) Journal

      Texas doesn't specifically tax ISPs, it just doesn't give them a 100% exemption from the standard sales tax paid on all purchases. Texas DOES exempt the first $25/month, so low-end internet is tax free. Above $25, buying fast internet is just like buying anything else.

      Texas has no income tax, so exemptions to the sales tax are necessarily limited - food, and school supplies and clothes during back-to-school season, and not much else.

      • Texas doesn't specifically tax ISPs, it just doesn't give them a 100% exemption from the standard sales tax paid on all purchases. Texas DOES exempt the first $25/month, so low-end internet is tax free.

        A progressive tax? this just gets worse and worse.

        Above $25, buying fast internet is just like buying anything else.

        Texas has no income tax, so exemptions to the sales tax are necessarily limited - food, and school supplies and clothes during back-to-school season, and not much else.

        Remember though, I'm just being a smartass here. Every state has to fund itself, until we drown the government in the bathtub. Texas is no exception.

      • by Bengie ( 1121981 )
        I pay sales tax on my internet. Not a huge issue. As long as they don't start adding new specific taxes.
    • by Anonymous Coward

      Texas has no income tax, so taxing internet access (service fees) just like any other purchase is reasonable.

      There are loads of taxes (state and federal) on phone bills, why is that? To help fund the infrastructure - oh, wait, the Telcos pay for that themselves...

  • the other states... (Score:5, Informative)

    by jonpz ( 3875625 ) on Sunday January 11, 2015 @08:57PM (#48790079)
    it's not in tfa, so from another source: "Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Texas and Wisconsin currently tax Internet access under ITFA's 1998 grandfather clause. Tennessee, Washington, and New Hampshire are permitted to collect Internet access taxes but do not currently do so." source: http://www.governing.com/news/... [governing.com] just in case anyone else was curious.
  • Man, the B.S. is getting deep in here.

  • by mysidia ( 191772 ) on Monday January 12, 2015 @12:22AM (#48790741)
    "US Lawmakers Push For a Permanent Ban On Internet Access




    Taxes"

    Don't you think you could have used a shorter headline, so Taxes would be on the same line ? you know.. like "US Lawmakers push to make internet tax moratorium permanent"

    • by Imrik ( 148191 )

      It's not their fault you have a small browser window and/or low resolution display.

      • by Ash-Fox ( 726320 )

        Note: Not OP.

        It's not their fault you have a small browser window and/or low resolution display.

        What's small and/or low resolution about my browser/display?

        [Screenshot [dropbox.com]]

      • by mysidia ( 191772 )

        It's not their fault you have a small browser window and/or low resolution display.

        My resolution is 1440 x 900, and the browser window is maximized.

        http://screencloud.net/v/9qFv [screencloud.net]

  • So even without taxes the US internet is shit. But in The Netherlands we pay 21% taxes and have much better and cheaper internet. Proof that taxes are not always bad?
    • by Anonymous Coward

      Proof you dont understand what youre talking about.

    • Assuming high taxes result in fast internet is like assuming German cars are the fastest in the world because the Autobahn has no speed limit.
  • "Permanent" means "until the next congress sees fit to rewrite the law, which could be tomorrow, really, but likely means at least 2 years or more likely until the next party takes control of congress".

    It's like when your mom says "you are permanently banned from X"...it really just means until some time passes and she changes her mind.

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