Groups pressure Senate to keep Internet tax ban

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More than 40 groups are urging Senate leaders to pass a long-term extension of a ban on state and local taxes on Internet access. 

The coalition sent a letter to Senate Majority Leader Mitch McConnellMitch McConnellThis week: Shutdown deadline looms over Congress Week ahead: Funding fight dominates Congress Week ahead in tech: Key test for FCC's TV-box plan MORE (R-Ky.) and Senate Democratic Leader Harry ReidHarry ReidThis week: Shutdown deadline looms over Congress Week ahead: Spending fight shifts from Zika to Flint Black Caucus demands Flint funding from GOP MORE (D-Nev.) pressing them to keep the tax ban “permanent” in a customs bill that would extend the ban and has already passed the House.

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“Numerous studies continue to show that cost remains an obstacle to Internet access and, if taxes on the Internet go up, even fewer people will be able to afford to go online,” the groups wrote in a letter Thursday. “This would impede our nation’s long held goal of universal Internet access.”

The letter was signed by a number of groups representing business, women, minorities and conservatives. Those groups ranged from Americans for Tax Reform and the Chamber of Commerce to LULAC and the National Black Caucus of State Legislators. 

The issue has been fiercely lobbied by both sides after the Internet tax provision made its way into a conference report on the customs bill late last year. 

The 1998 ban prevents most state and local governments from tacking taxes onto the monthly bills customers pay for Internet access. The ban has needed a number of extensions since initial passage, but some lawmakers are now trying to remove the sunset date on the banned tax. 

A number of state and retail groups have pressed lawmakers to strip the provision out of the customs deal. 

For years, they have hoped to use a permanent tax ban as a vehicle to pass a more controversial bill that would give states increased authority to tax online purchases made from out-of-state retailers. 

Both sides have anticipated a close vote if the customs bill makes it to the Senate floor. The House approved the deal in December.