The LAN tax

The state of Florida is mulling a rule that could result in taxation of computer networks – both WAN and LAN.

The rule is taking businesses by surprise, according to a story in the Orlando Business Journal:

https://orlando.bizjournals.com/orlando/stories/2003/08/25/story1.html

The article says the state would tax networks 9.17%, and local districts could add their own tax to it. What exactly would be taxed? Either the lease payments or annual depreciation of network equipment, according to the article.

The unusual proposal is apparently coming out of Florida’s struggles to figure out taxation of communications networks when those networks are more than just plain old telephone service.

Taxing LANs, however, seems to be taking things a little too far. If you’re going to do that, why not tax the PCs and servers connected to them? And do you also tax cable modems and home networks?

To be sure, the Orlando Business Journal article indicates that Florida officials are right now just floating this idea to see how much businesses hate it. Hopefully, through this process will come a meaningful discussion of what in communications networks can be taxed – and what shouldn’t.

This news item, by the way, was passed to me by Adam Gaffin, Network World’s executive editor for online. You can find more interesting stuff from around the Web daily in his Compendium column:

https://napps.nwfusion.com/compendium/index.html