Alexander Slams Internet Access Tax Ban

The Tennessee Republican said the taxation ban imposes significant costs on the states and he will try to keep it from being renewed.

InformationWeek Staff, Contributor

October 23, 2003

1 Min Read

WASHINGTON (AP) -- A temporary ban on taxing Internet access services runs out at the end of the month, and Sen. Lamar Alexander said Wednesday that's fine with him.

The Tennessee Republican said because the taxation ban imposes significant costs on the states, he will try to keep it from being renewed after it expires Nov. 1. Alexander once was Tennessee's governor.

Lawmakers have been working on a bill to ban taxes on Internet access permanently. Some state and local governments have objected, arguing the bill could unintentionally exempt telecommunications companies from all taxes as those firms deliver increasingly more services through the Internet.

Alexander said he will work to defeat the legislation.

"We're big talkers about local control, state responsibilities, state's rights," he said. "Somehow when we get to Washington and away from home, all that goes up in smoke."

Alexander said the bill would disfavor some taxes arbitrarily over others.

"This is none of Congress' business," he said.

State governors also are lined up against making the temporary prohibition of taxes permanent.

"This expansion threatens to cost state and local governments billions of dollars annually at a time when states are facing the worst fiscal crisis in 50 years," the National Governors Association wrote in a letter to Senate leaders.

Sen. Ron Wyden, D-Ore., said state and local governments voiced the same worries about losing tax revenue when Congress enacted the first temporary ban five years ago.

"We were told Western civilization was going to end at that time," he said. "We have not seen that to be the case."

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