Internet Tax Moratorium and Equity Act
Key claim: This bill would permanently ban most new state and local taxes on Internet access, extend through 2005 the ban on multiple or discriminatory e-commerce taxes, and let states join a compact for a streamlined sales-tax system on remote sales.
Abstract
(S1542 · 107th Congress) Internet Tax Moratorium and Equity Act - Amends the Internet Tax Freedom Act to extend: (1) permanently provisions which prohibit a State or political subdivision from imposing taxes on Internet access, unless such tax was generally imposed and actually enforced prior to October 1, 1998; and (2) until December 31, 2005, the State or political subdivision prohibition on multiple or discriminatory taxes on electronic commerce. Expresses the sense of the Congress that: (1) States and localities should work together to develop a uniform streamlined sales and use tax system that addresses remote sales; and (2) a study should be commissioned to determine seller costs of collecting and remitting State and local sales and use taxes from remote sales. Authorizes States to enter into an Interstate Sales and Use Tax Compact which shall describe a uniform, streamlined sales and use tax system consistent with the above system. Latest action (2001-10-11): Read twice and referred to the Committee on Commerce, Science, and Transportation.
Why this matters
The internet-access tax moratorium and the treatment of remote-seller sales taxes have been recurring flashpoints in state/local tax policy, pitting state and local revenue authorities against telecoms, e-commerce sellers, and consumers. This 2001 bill is an early example of the pattern that later produced the permanent Internet Tax Freedom Act and, separately, the Streamlined Sales and Use Tax Agreement — showing how Congress tried to bundle an access-tax ban with a voluntary state compact on remote sales.