Posted on 11/21/2003 12:16:29 PM PST by .cnI redruM
WASHINGTON (Reuters) - A U.S. senator said on Thursday that he would hold up a massive year-end spending bill if it included a ban on Internet-access taxes that he and several colleagues fear would harm state and local finances.
Delaware Sen. Thomas Carper, a Democrat, told reporters he would try to keep the omnibus bill from coming to the Senate floor if the ban was included in its present form, which he said infringed on the rights of state and local governments to raise revenues.
"If we end up with just an awful ... provision I would certainly object to bringing the omnibus spending bill to the floor and I suspect others will join me," Carper told reporters after a news briefing on the issue.
Although Senate rules offer many ways for individual senators to hold up bills they disagree with, it would be hard for Carper to do more than delay the bill for a few days.
Colleagues said they hoped to reach a deal with lawmakers on the other side of the issue before matters reached a head.
The ban is meant to replace a 1998 moratorium that kept state and local government from imposing taxes on the monthly fees Internet providers such as EarthLink Inc (ELNK). charge their customers. The moratorium expired on Nov. 1.
As written, the replacement measure would permanently ban those taxes as well as taxes on high-speed cable and DSL services not covered under the original moratorium.
The new version, which cleared the House of Representatives in September, would also eliminate access taxes that were in place in some states before 1998. Senate leaders brought the bill to the floor several weeks ago but pulled it back after it became apparent the measure might not pass easily.
BROADLY WORDED BILL
State and local governments fear the legislation is worded so broadly that it would restrict them from collecting all manner of other taxes on the telecommunications industry.
They say it could cost them as much as $9 billion in tax revenues a year by 2006 as phone calls, music sales and other activities migrate to the Internet.
The Congressional Budget Office estimates these jurisdictions would lose $195 million that year but said the true cost of the provision could not be determined and could be much higher.
Calling the ban proposal an unfunded mandate on states and a massive tax break for the telecommunications industry, Republican Sen. Lamar Alexander of Tennessee said he and his colleagues had proposed a compromise two-year ban.
The compromise would ban access taxes both on DSL and in states previously allowed to tax Internet access services.
He said there was also a chance that the two sides could simply agree to extending the terms of the expired moratorium for a few months while they agreed on what should come afterward.
But Virginia Republican Sen. George Allen, whose state boasts a large high-tech business community and who supports the permanent ban proposal, said he could not accept an extension either for a few months or two years.
"Senator Allen does not believe a two-year extension provides either consumers or businesses with adequate stability to plan future significant buildout of broadband," his spokesman said, adding that Allen's goal was to keep industry costs down to make Internet access affordable for all.
A spokeswoman for Oregon Sen. Ron Wyden, a Democrat, said Wyden was similarly unmoved by proposals presented thus far. Extension of the terms of the previous ban simply gave states more time to institute new taxes on the Internet, she said.
Way to go Democrats. Raise taxes, raise the costs associated w/ high technology and send that industry running to China or Japan. That ought to give Howard Dean enough unemployment to win an election with!
Uh........the "right" of the government trumps the "right" of the people? Good thing they said he was a Democrat. I'd hate to have the readers miss that part.
It's really the only real freedom we have left. We colonists have discovered and conquered a new land. We've named it cyberspace.
Now the kings of the earth are trying to tax this one out of existance, too.
You know you're a red neck if....
Your whole family is Democrats 'cept for lil Mary. She got ta readin'.
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