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IT Confidential: Ah, Spring! Love, Basketball, And Taxes

Taxing the Internet: It's something small businesses and Web entrepreneurs bemoan, and state and local governments increasingly advocate as a way to help out depleted budgets. Several states are mulling ways to tax online sales, including a consortium known as the Streamlined Sales Tax Project, which is figuring out technical and jurisdictional ways to make an online sales tax work. The feds wanted to prevent local and regional governments from taxing Internet access--and shelter a budding industry--with the 1998 Internet Tax Freedom Act, which was reauthorized for two years in 2001 and renamed the Internet Tax Nondiscrimination Act. But "the fledgling-industry argument is no longer relevant," said Harley Duncan, the executive director of the Federation of Tax Administrators, testifying last week before the House Judiciary Committee's Subcommittee on Commercial and Administrative Law, which is considering legislation that would make the Internet-access tax ban permanent. If Congress reauthorizes the ban, it should be for just five more years, said Duncan, whose association represents tax administrators from the states, as well as New York City and Washington, D.C. On the other hand, Jack Kemp, the former congressman and GOP presidential candidate, testified that Congress should go beyond banning Internet-access taxes and take steps to limit the ability of states and local governments to collect taxes on purchases made online.

Microsoft last week tapped Debra Chrapaty as corporate VP of MSN Operations, responsible for the infrastructure and global network of the MSN brand, including the MSN portal, Hotmail, Messenger Service, and the Passport authentication service. Chrapaty will report to David Cole, senior VP of Microsoft's MSN and Personal Services Division. Chrapaty had been senior VP of technology at Organic Inc., an Internet marketing company. She's had a wealth of IT experience, from chief technology officer of the National Basketball Association to chief operating officer of E-Trade, the online brokerage. While at E-Trade she was InformationWeek's Chief of the Year in 1998.

California's CIO, Clark Kelso, was given some added responsibilities by Gov. Gray Davis, who named him interim director of the Department of General Services. Kelso, 43, will manage a department with six divisions, 23 operational offices, 4,000 employees, and an annual budget over $500 million. The department oversees state E-commerce and telecommunications initiatives; the acquisition and management of state properties; architectural approval of local schools and state buildings; printing services; procurement of supplies; and maintenance of the state's fleet of vehicles. Kelso has been serving as Davis' special adviser on IT and state CIO since September, a job he'll continue.

Taxes? Oh, $#*%! Anyone got a copy of TurboTax 2002 you can lend me? (Just kidding!) Or an industry tip? Send it to or phone 516-562-5326. If you want to talk about Internet taxes, MSN performance, or the joys of added responsibilities, meet me at's Listening Post:

To discuss this column with other readers, please visit John Soat's forum on the Listening Post.

To find out more about John Soat, please visit his page on the Listening Post.

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