Internet tax panel adjourns without an accord

Days and hours of meetings and arguments in Dallas left the Advisory Commission on Electronic Commerce the same place as it started: with no agreement on a recommendation to Congress in regards to taxing Internet sales. In the end the Commission agreed to hold a conference call March 30 to try to reach a consensus before its April 21 deadline.

"These business commissioners have used their position on the ACEC to serve their corporate interests," said Lisa Cowell, executive director of the ICSC-backed E-Fairness Coalition.

The 19-member ACEC comprises business representatives appointed by Congress from America Online, Time Warner, Gateway, Charles Schwab, AT&T, and MCI Worldcom; government officials; and a few Clinton appointees. The commission needed a two-thirds majority to agree on its stance, but it was unable to reach that on any of the proposals discussed at the meeting.

Instead, a simple majority, led by the business representatives, agreed to write a report for Congress reflecting its views that highlight several specific positions on tax policy. The report will include recommending a repeal of the 3% federal telecommunications excise tax; a permanent ban on Internet access taxes; an exemption from sales taxes for digital products; and extending the moratorium on new Internet taxes into 2006.

Meanwhile, ICSC members in Washington today lobbied members of Congress on the issue of collecting sales taxes on purchases made over the Internet. Indianapolis-based Simon Property Group president and COO Richard S. Sokolov told SCT Newswire that this is the most important issue to face the industry in the last 10 years.