INTRODUCTION OF BILL TO AMEND INTERNET TAX FREEDOM ACT -- HON. JOHN CONYERS, JR. (Extensions of Remarks - April 13, 2000)

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HON. JOHN CONYERS, JR. OF MICHIGAN IN THE HOUSE OF REPRESENTATIVES Thursday, April 13, 2000

Mr. CONYERS. Mr. Speaker, I am pleased to join with Chairman HYDE, Commercial and Administrative Law Subcommittee Chairman GEKAS, and Ranking Member NADLER in introducing the ``Internet Tax Reform and Reduction Act of 2000.''.

As the Ranking Member of the Judiciary Committee, I have been proud of our Committee's bipartisan accomplishments in helping to maintain our Nation's leadership in the information economy. These include modernizing our patent and copyright laws, insuring the availability of trained workers, and our passage last Congress of the Internet Tax Freedom Act.

Today, I join with my colleagues in introducing the Internet Tax Reform and Reduction Act of 2000 as the starting point in our process of considering possible legislative responses to the issue of the applicability of State and local taxes on the Internet. The legislation we are introducing today reflects the views of number of Advisory Committee on Electronics Commerce Members led by Virginia Governor James Gilmore.

I believe it is important that their views be converted into legislative language so that the Congressional review process can commence. I intend to work with Chairman HYDE and Representatives GEKAS and NADLER in seeing that the other members of the Commission, including Utah Governor Michael Leavitt, are given the same opportunity. I also expect that the Judiciary Committee's Subcommittee on Commercial and Administrative Law will hold a series of hearings during which all interested parties, including State and local elected officials, the technology community, and retailers will be able to offer their views.

The bill we are introducing today would amend the Internet Tax Freedom Act to impose a permanent moratorium on State and local taxes on Internet Access. It would also extend for 5 years the duration of the moratorium applicable to multiple and discriminatory taxes on electronic commerce and impose a 5 year moratorium on sales of digital goods and products. Further, the bill would set forth factors for the determination of jurisdictional nexus by the States with regard to Internet transactions, encourage the States to adopt a simplified sales and use tax, and set up an advisory commission on uniform sales and use taxes.

The issue of the application of State and local taxes on the Internet is one of the most important matters facing the Judiciary Committee and the Congress. The Internet has led our robust economy into the 21st century. Its use in both the commercial and consumer sectors has skyrocketed, spurring the development of new businesses, products and services, and new and less expensive research and communications methods. At the same time, the Internet poses many new and novel State and local taxation issues. The Internet is not a partisan issue by any means, and I am happy to join with my colleagues as we begin to address this critical issue.
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