Associations Ask Congress to Act on Internet Tax

By Jennifer Freer, Staff Writer


MAY 1 ? Eleven high-tech trade associations have joined in a letter asking Congress to address "in a comprehensive manner" the touchy issue of Internet taxation, including extending the moratorium on governments invoking any new taxes on Internet transactions.


The May 1 letter sent to all offices on Capitol Hill follows an April 12 report from the congressionally appointed Advisory Commission on Electronic Commerce. The commission, chaired by Virginia Gov. James Gilmore, (R) voted in favor of extending the existing moratorium on no new taxes on the Internet.


The trade groups said in their letter that "Congress has legislative authority over matters involving interstate commerce and, therefore, has a very important role in this policy debate that has traditionally been focused on the states."


Signing the letter were the presidents of: the American Electronics Association, Consumer Electronics Association, Electronic Components, Assemblies & Materials Association, Electronic Industries Alliance, Government Electronics & Information Technology Association, Information Technology Association of America, National Association of Manufacturers, Securities Industry Association, Software Finance & Tax Executives Council, Software & Information Industry Association, and the Telecommunications Industry Association.


Along with extending the tax moratorium, the trade groups also seeks these measures:


* Eliminate the Federal Telecommunication Excise Tax and create an environment in which simplification of telecommunications could occur.



* Create an environment in which true simplifications sales and use taxation may occur.


* Reduce costly litigation between taxpayers and governments by clarifying rules regarding taxes.