Tuesday, February 29, 2000
Taft likes Clinton stand on Internet taxes
President plans to let states take the lead
BY KATHERINE RIZZO
The Associated Press
WASHINGTON — Ohio Gov. Bob Taft said Monday he was pleased that President Clinton is willing to let state governments lead the national debate on whether sales taxes should be collected from Internet purchases.
“We're talking about what fundamentally should be a state issue area,” Mr. Taft told reporters who waited on the White House lawn during a meeting between Mr. Clinton and the nation's governors.
Mr. Taft said he could support a short extension of the current moratorium on new taxes while states devise a consistent approach to the problem.
“We need more time to figure out what we're going to do,” he said. “It's very important that the states work together.”
Led in part by Ohio Republicans John Kasich and John Boehner, a considerable sentiment exists in Congress favoring a tax-free Internet in order to encourage the growing field of electronic commerce.
Some governors have openly worried about that as a drain on future state revenues. Mr. Taft has not declared whether he wants his state to be able to collect sales taxes from out-of-state companies who ship goods to Ohio customers they connected with over the Internet.
Mr. Clinton told the governors he thinks federal law should not preempt their state laws.
“He said that this is an issue that they're going to have to work out among the states,” Clinton spokesman Joe Lockhart said.
The president “told the governors that this is an issue that we're going to have to work out together.”
“It may have to involve some simplification of sales taxes,” Mr. Lockhart said.
That is the approach favored by many governors and by Sen. George Voinovich, R-Ohio, one of the louder voices on Capitol Hill in favor of sales tax collection on Internet purchases.
A commission headed by Republican Gov. James Gilmore of Virginia is studying how to proceed on several Internet taxation questions, including what to do when the current moratorium expires in 2001.
The commission is due to release its recommendations in April.
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