Thursday, November 11, 1999
Reps. call for Internet tax ban
Cities, states fear loss of revenue
BY PAUL BARTON
Enquirer Washington Bureau
WASHINGTON — Two prominent House Republicans, Ohio Reps. John Boehner and John Kasich, called Wednesday for a permanent ban on taxation of commerce on the Internet.
It is a position that won the applause of anti-tax groups but is unsettling to the nation's mayors and governors.
Many state and local groups, as well some Cincinnati city officials, said they are concerned about such a ban, noting the importance of sales taxes to their budgets.
But Mr. Boehner, of West Chester, and Mr. Kasich, of Westerville, were adamant as they unveiled their proposal at the National Press Club.
“The explosive growth of e-commerce represents nothing short of a second Industrial Revolution,” said Mr. Kasich, chairman of the House Budget Committee. “The biggest threat to this growth is the possibility of government treating the Internet like a cash cow.”
Messrs. Kasich and Boehner are sponsoring the Internet Tax Elimination Act. The bill would make permanent the three-year moratorium on Internet taxes that Congress enacted in 1998 while establishing an independent commission to study the matter.
Both said they would fight for passage before the 106th Congress ends next year.
“The Internet is the last bastion of economic freedom in America — the one sector of our economy that remains free of excessive regulation and taxation,” Mr. Boehner said. “We ought to keep it that way.”
The Kasich-Boehner proposal comes as the federally established Advisory Commission on Electronic Commerce is trying to arrive at recommendations to make to Congress by April.
State and local government lobbying groups, such as the National Governors' Association, want to preserve the right to tax e-commerce.
With more business being conducted online, they are worried that major components of their tax revenues, especially sales taxes, will start to evaporate.
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