At the beginning of the new Millennium, in this time of budget surplus and prosperity, the U.S. House of Representatives has acted to save Americans precious tax dollars by repealing an outdated and counterproductive tax.  Over a century ago, the U.S. entered into the short, but decisive, Spanish-American War.  Like most wars, it drained a sizeable amount of our country’s resources. Therefore, Congress passed a “temporary luxury tax” to help pay for it. The tax, which amounted to a penny on long-distance phone calls costing more than 15 cents, was on a luxury item called the telephone that only the wealthiest Americans in 1898 could afford to use.  At the time, there were only 1,376 telephones in the U.S.   Now, the tax is collected on an estimated 252 million business and residential telephone lines across the country, including cellular phones and those hooked up to fax machines and computer modems. People and businesses with multiple phones often pay the tax several times a month. Recently, the U.S. House of Representatives agreed to, and I strongly supported, finally putting an end to the Spanish-American War telephone tax.

 Today, 102 years later, this “temporary” tax lives on. It is proof that once a tax is imposed in Washington, it is almost impossible to get rid of it. The tax has actually been repealed twice before, then brought back when the U.S. entered World War I and during the Depression. It has been raised, lowered, put on track for a phase-out that was delayed numerous times and, finally made permanent a decade ago.  The excise tax originally affected less than two percent of the U.S. population. Currently, 96 percent of Americans who access the Internet at home do so through their telephone lines.  It is an example of a tax that has been overlooked and is a classic example of bad tax policy. It disproportionately falls on the backs of the people who can least afford it,  low-income American families, students and seniors on fixed incomes who depend on a telephone as a lifeline to the outside world. 

 We are now in the technology and communications age.  I strongly support lowering telecommunications costs and expanding Internet access for all Americans. The Spanish-American telephone tax is a perfect example of how Congress can streamline obsolete taxes, thus providing relief to our families and encouraging economic growth. Currently, the federal excise tax appears as a separate line on most phone bill, including cellular phone bills. Families and small businesses will see an immediate reduction in their expenses after the elimination of the tax. While it’s only $3 or $4 a month for each household, it would reduce federal government revenue by about $24 billion over five years.  But like the late Senator Everett Dirksen said, “A billion here, a billion there, pretty soon you’re talking about real money.”

 The House is working on other measures that will prevent unnecessary burdens on Americans. For instance, the House recently passed a bill that would ban per-minute Internet access charges. The U.S. House of Representatives unanimously passed H.R. 1291, the Internet Access Charge Prohibition Act, that strips the Federal Communications Commission (FCC) of the ability to impose per-minute Internet access charges. The majority of correspondence from my constituents shows strong opposition to any type of tax on the Internet or e-mail. If West Texans were charged by the minute when they surfed the web or e-mailed, it would drastically increase the cost and dramatically inhibit their use of the Internet. Congress also agreed to repeal the marriage tax penalty, which was an unfair burden on over 63,000 West Texans in the 19th District alone

 I am pleased that Congress is on the right path to correct a tax code that is too complicated, unfair and intrusive. We need a fairer, simpler and less-intrusive tax code. Providing tax relief to hard-working Americans is one way that will help ease the burden that our tax code has placed on taxpayers.  You can be assured that I will continue to work towards that goal.