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Press Release
Extend the E-Tax Moratorium
Released by James Plummer on 11/10/99
of Consumer Alert

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Contact: James Plummer, 202-467-5809

Consumers would be well served by an extension of the moratorium on Internet taxes initiated in the Internet Tax Freedom Act. Electronic commerce has taken consumer choice to the next level, enabling shoppers to survey wares from around the globe from the comfort of home. Levying taxes on this emerging medium would threaten its growth and promises to deny its opportunities to those who have yet to discover it:

Internet taxes already lock the poorest Americans out of cyberspace and deny them the consumer opportunities found within. For instance, a study by the Progress & Freedom Foundation found that at least 165,000 households in the United States are priced out of the Internet access market due to telecommunications taxes.

The "Trojan horse" proposal by the e-tax advocates would, under the pretense of leveling the playing field between brick-and-mortar retailers and "e-tailers," raise taxes across-the-board by imposing new obligations on remote-sellers of every type, undermining tax competition between states. By having out-of-state retailers or intermediate parties collect taxes under their monstrous contrivance, the big-government lobby is pushing a program of taxation without representation that lacks accountability and locks consumers and taxpayers out of the policymaking process.

Dangerous E-tax schemes endanger consumer privacy. Despite the reassurances of the tax collectors, the collection of consumer shopping information by the government or its agents is a Dangerous Thing. The elaborate schemes dreamed up by the tax-and-spend crowd would collect data on consumer purchases and sort it by location and taxability. Once a national system of tax-collection software is set up, history tells us it will be far too easy for governments or their agents (no matter if they call themselves "trusted" third-parties) to expand the amount of consumer data monitored and collected.

The Internet has facilitated the growth of unique businesses serving niche markets. These e-commerce businesses mean new jobs and a stronger economy, contributing to record tax surpluses. But nefarious new taxes and regulations will kill many new start-up ebusinesses before they even start up; denying consumers the chance to find specialized products and services for their needs. The burden of additional taxes and regulations will also hinder existing small businesses from expanding online, further restricting consumer choice.