Americans from all sectors of society use the Internet for social and economic reasons. Many use it as a means of climbing the economic ladder. That’s why every American has a vested interest in the debate in Washington over the Internet Tax Freedom Act (ITFA) and the Internet sales tax (IST).
ITFA, a moratorium on discriminatory state and local taxes on the Internet (i.e. “email taxes”), is something Americans on both sides of the aisle and opposite ends of the political spectrum support.
Some lawmakers are trying to hold the moratorium hostage until they can attach to it a very unpopular tax on Internet sales, the so-called Marketplace Fairness Act (MFA). The MFA would allow states to require out-of-state retailers to collect and remit their sales taxes, regardless of whether they have a physical presence in the state.
Before ITFA’s passage in 1998, 10 states had imposed taxes on Internet usage. Over the past 16 years, Congress has renewed the moratorium four times, most recently in 2007, which means the moratorium is constantly under threat of not being continued should revenue-hungry lawmakers get their way. This year, the House passed a bill by unanimous voice vote extending the moratorium indefinitely, but the Senate failed to do the same, instead extending ITFA only until Dec. 11, 2014.