On the average commute, Americans don a similar accessory in the palm of their hands: smartphones. Their eyes transfixed on the screens, they absorb the day’s news on the Internet, text friends, write e-mails, check the weather, take pictures, conduct business, or map step-by-step directions to their next location.
Whether or not we are conscious of the importance of the Internet and on-the-go access in our lives, mobile technology and Internet access have evolved into a modern-day necessity. A recent study conducted by TIME shows that 84 percent of people surveyed cannot go a day without their cell phones. Young adults rely on their cell phones at unprecedented levels: 75 percent of 25-29 year olds even sleep with their phones.
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However, some see this dependence on Internet access as an opportunity to exploit its growth and to create a new revenue stream for state and local governments. Currently, a temporary moratorium is in place to prevent Americans from paying Internet access taxes, but some state governments and other organizations would like to see the moratorium lapse on November 1st.
Goodbye, streaming movies and downloading on the go unless you want to pay the access tax — and it’s not cheap either! It is estimated that Internet access tax rates could be more than twice the average rate of all other goods and services. In addition, low-income households could pay 10 times as much as high-income households as a share of income.
The last thing that Americans need is an additional tax. This move is not good for American consumers or for the future of the Internet.
The House of Representatives has fought hard to keep the government out of the pocketbooks of citizens. Over the past 16 years, Congress has passed ban after ban on Internet access taxes. Only five “no” votes were ever cast in the House and Senate in the renewals of the ban.
In the House Judiciary Committee, where I serve as Chairman, we recently approved the Permanent Internet Tax Freedom Act (H.R. 3086), which would ban state and local governments from taxing Americans for Internet access — permanently.
And yesterday, the bill advanced to the House Floor and passed unanimously. Now it is the Senate’s turn to pass this vital piece of legislation to protect American consumers.
If the permanent ban on Internet access taxes does not pass the Senate before November 1, the potential tax burden would be substantial for all Americans, and its effects could be detrimental across the board. It is proven that as prices rise, demand falls. A former White House Chief Economist estimated a tax that increased the price of Internet access by 1 percent would reduce the demand for Internet access by 2.75 percent.
Now is the time for the Senate to pass the Permanent Internet Tax Freedom Act that would permanently ban state and local governments from taxing Internet access. A permanent ban is necessary for protecting our digital economy and the tremendous medium of the Internet for future generations.
