House Approves 2014 Moratorium on Internet Taxes

With a motion by Rep. Linda Sanchez (D - Calif.) to suspend the rules, the US House of Representatives agreed today to accept Senate language approved last week, extending the ban on both state and federal taxes on Internet use until November 2014.

"The seven-year time frame will allow Congress to revisit the moratorium and consider developments in the States or in technology," stated Rep. Sanchez on the House floor this morning. "It will also provide businesses sufficient time to plan, and ensure that consumers benefit from tax-free access to the Internet."

While the House had approved an earlier version of the bill by a stunning 405-2 vote, Sanchez believes the Senate language improves on that measure, first by granting states extra time to adjust for lack of anticipated revenue, and also by extending the ban to services that providers may choose to provide with Internet service, that may not necessarily qualify as Internet service.

The key addition to which Sanchez referred is the following extension of the definition of "Internet services:" "[It] includes services that are incidental to the provision of the service described in subparagraph (A) when furnished to users as part of such service, such as a home page, electronic mail and instant messaging (including voice- and video-capable electronic mail and instant messaging), video clips, and personal electronic storage capacity."

"This legislation minimizes the effect on state and local government revenue, treats businesses fairly, and keeps Internet access affordable to consumers," Sanchez said. There may have been little, if any, opposition to her motion to adopt.