Since 1998 it has been prohibited by federal law for states and localities to tax Internet access. This policy, known as the Internet Tax Freedom Act, has been extended three times with broad bipartisan support. But it is set to expire again onNovember 1, and some Senate Democrats appear willing, this time, to allow it to actually expire if they can't use it to leverage an unrelated tax issue. It's a dangerous game that could cost taxpayers billions of dollars and worsen the digital divide by pricing some lower income Americans off of the Internet entirely.
The House, led by Judiciary Committee Chairman Bob Goodlatte of Virginia, passed a bill last month to make the ban on Internet access taxes permanent. It was a voice vote - meaning not a single member objected. "The permanent Internet Tax Freedom Act merely prevents Internet access taxes and unfair multiple and discriminatory taxes on e-commerce," Goodlatte explained on the House floor. "It does not tackle the issue of Internet sales taxes."
And that, for many senators, is the problem. The Senate has already passed a highly controversial bill authorizing states to collect sales taxes on out-of-state purchases called the Marketplace Fairness Act. But that bill - which is popular with retailers but not with most consumers, for obvious reasons - has not moved in the House.
Before the Senate left for its August recess, Senator Ted Cruz of Texas made a motion for the Senate to, like the House, unanimously pass a permanent extension of the ban on Internet access taxes. "One of the reasons the Internet has been such an entrepreneurial haven is that Congress has wisely decided to keep it free from taxation, not to subject the Internet to taxation," Cruz said.
Unlike the House, however, his request was met not just with an objection but a rather emphatic one, voiced by Democratic Senator Heidi Heitkamp of North Dakota, likely on behalf of Senate Democratic leaders.
Phil Kerpen is president of American Commitment, a columnist on Fox News Opinion, chairman of the Internet Freedom Coalition, and author of the 2011 book Democracy Denied.
American Commitment is dedicated to restoring and protecting America’s core commitment to free markets, economic growth, Constitutionally-limited government, property rights, and individual freedom.
Washingtonian magazine named Mr. Kerpen to their "Guest List" in 2008 and The Hill newspaper named Mr. Kerpen a "Top Grassroots Lobbyist" in 2011.
Mr. Kerpen's op-eds have run in newspapers across the country and he is a frequent radio and television commentator on economic growth issues.
Prior to joining American Commitment, Mr. Kerpen served as vice president for policy at Americans for Prosperity. Mr. Kerpen has also previously worked as an analyst and researcher for the Free Enterprise Fund, the Club for Growth, and the Cato Institute.
A native of Brooklyn, N.Y., Mr. Kerpen currently resides in Washington, D.C. with his wife Joanna and their daughter Lilly.