| The e-Freedom
Proposal Slashes Barriers to Net Access by Staff on 11/10/99 of E-Freedom Coalition Topic: General, Taxation, Internet Access | |
| I Rather than impose new and onerous tax collection schemes, the e-Freedom proposal takes a more open approach that respects the sovereignty of both taxpayers and local jurisdictions. Recognizing that a citizen's ability to take advantage of all the Internet offers, including e-commerce, completely depends on the Internet's accessibility, we begin our proposal with five recommendations to tear down and prevent the re-emergence of government-imposed taxes and regulations that serve only to drive up costs for consumers and retard the investments needed to strengthen and maintain the national information infrastructure. Specifically, we have identified five tax-related barriers to Internet access: 1. Barrier #1: The federal 3% excise tax on telecommunications. The tax is an anachronism and should be repealed immediately. 2. Barrier #2: Discriminatory ad valorem taxation of interstate telecommunications. Fifteen states tax telecommunications business property at rates higher than other property, driving up costs for consumers. Federal protections against such taxes – already in effect for railroads, airlines and trucking -- should be extended to telecommunications. 3. Barrier #3: Internet tolls – new taxes and fees levied on telecommunications providers and their customers when cable is installed along highways and roads. These new taxes, which can run up to 5% of gross receipts, drive up costs for consumers, and should be abolished. Congress should make clear that the 1996 Telecommunications Act intended only for state and local governments to be reimbursed for actual costs incurred for managing public rights of way. 4. Barrier #4: High state and local telecommunications taxes, complicated auditing and filing procedures. Many governments are using consumer telephone bills as cash cows, imposing multiple and high taxes on services. Such taxes should be slashed to a single tax per state and locality, and filing/auditing procedures streamlined. 5. Barrier #5: Internet access taxes. The temporary federal ban on Internet access taxes should be made permanent. States and localities that imposed such taxes before the ban took effect should repeal any taxes on access to keep costs down for consumers. ### |
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