* Getting to the heart of Internet access
In order for e-commerce to consistently grow, more shoppers have to come onto the ‘Net. Legislators are pushing hard to make sure that no taxes are levied that would create an obstacle to growing the online population.
A U.S. House of Representatives Judiciary Subcommittee voted last week to extend a moratorium on Internet taxation. The specifics of what is being called the “Internet Tax Nondiscrimination Act” are aimed at prohibiting the taxation of Internet access. Jurisdictions across the country have been anxious to put a price tag on pushing bits around the Internet – a price tag that would show up on ISP bills.
It’s an interesting discussion because the types of Internet access come into play. Are you accessing the ‘Net over dial-up, cable or DSL? Are all of those methods being equally taxed?
Some argue that any taxation would thwart e-commerce growth. Others argue that partial taxation will give some access providers an unfair advantage. Still others say that the telecom companies are taking the brunt of new taxation wavers because they fall under the old telecom taxation rules.
This is just one of the many arguments surrounding taxation on the ‘Net. There is still the age-old argument brewing about sales tax. While it’s well understood that Internet sales should be treated the same as catalog or phone sales, there is still a push being made to waive all taxes on Internet transactions.
Bricks and mortar stores are up in arms over this, saying that it creates an unfair advantage. States are saying they will miss out on critical funding if folks can go online to buy things they would normally be taxed on in stores. And e-tailers say that they should be given a chance to get off the ground without being bootstrapped by the complexity of understanding tax jurisdictions.
Until there is a viable answer to either of these issues, I predict moratoriums will continue to be stretched. The mantra with e-commerce taxation seems to be if you can’t decide, put it off.
