Senators look to extend ban on Internet taxes

Republican Sens. Kelly Ayotte (N.H.) and Dean Heller (Nev.) introduced legislation Wednesday that would extend a law banning federal, state and local governments from taxing Internet access.

The Internet Tax Freedom Act, originally enacted in 1998, is set to expire in November 2014. The bill from Ayotte and Heller would extend the ban indefinitely. 

The Internet Tax Freedom Act bans taxes on Internet access and Internet-only services like email, but it does not prohibit sales taxes on online purchases. Sen. Dick Durbin (D-Ill.) and others are pushing legislation that would allow states to tax online purchases from other states.

“E-commerce is thriving largely because the Internet is free from burdensome tax restrictions. Unfortunately, tax collectors see it as a new revenue source, and they must be stopped,” Ayotte said in a statement. “This legislation will provide certainty to the marketplace, helping the Internet continue to be a driving force for jobs and growth.”

Heller said the government should not penalize people for buying Internet access.

"The Internet Tax Freedom Act will ensure a longstanding federal policy that prevents the government from raising taxes and preserves the Internet as a tool for education and innovation," he said.

Ayotte and Heller are members of the Senate Commerce, Science and Transportation Committee, which has jurisdiction over Internet policy.

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