Over the weekend, multiple sources on Capitol Hill began reporting on the prospect of the Internet Tax Freedom Act being made permanent as part of this year’s appropriations package. First enacted as part of a 1998 omnibus and since renewed annually with bipartisan support, the legislation imposes a “moratorium” on any state or local taxes on “internet access” (broadband subscriptions) with exceptions for eight states that already had such taxes in place. Past efforts to make the ban permanent have run up against internet sales tax proposals (the recurring Marketplace Fairness Act) and opposition from the grandfathered states based on lost revenue. This year’s attempts have been led by Representative Goodlatte (HR. 3806) and Senator Thune (S.431), and have built considerable momentum due to GOP concerns surrounding the FCC’s net neutrality rules.
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