Cox and Wyden Introduce Internet Non-Discrimination Act

(February 3, 2000) Rep. Chris Cox and Sen. Ron Wyden held a press conference to announce the introduction of the Internet Non-Discrimination Act, a bill to make permanent the moratorium on new discriminatory Internet taxes.

Rep. Chris Cox (R-CA) and Sen. Ron Wyden (D-OR) also sponsored the Internet Tax Freedom Act in the last Congress. It passed in the closing days of the 105th Congress, in November of 1998. President Clinton promptly signed it into law.

It contains a three year moratorium on new discriminatory Internet taxes. The Internet Non-Discrimination Act would not change any of the language of the Internet Tax Freedom Act, other than the clause specifying its duration.

There are already several other pending bills that would also make the moratorium permanent. These have been filed by Sen. Bob Smith (R-NH) - S 328, Sen. John McCain (R-AZ) - S 1611 IS, and Rep. Bob Kasich (R-OH) - HR 3252 IH.

The Cox-Wyden bill is very short and simple. Its substantive language provides that: "Section 1101(a) of title XI of division C of Public Law 105-277 is amended by striking ‘‘during the period beginning on October 1, 1998, and ending 3 years after the date of the enactment of this Act’’ and inserting ‘‘on or after October 1, 1998’’."

"The virtue of our bill is its simplicity," said Rep. Cox. "It doesn't revisit any of the complicated issues that were considered during the original writing of the moratorium."

Rep. Cox and Sen Wyden held a press conference in the basement of the Capitol Building on Thursday morning, February 3, to announce their new bill. They were joined by Rep. Bob Goodlatte (R-VA).

	Rep. Chris Cox (R-CA)

"This legislation will make permanent the existing Cox-Wyden ban on multiple, new, and technologically discriminatory taxes that are targeted at the Internet," said Rep. Cox. "Three years ago when Ron Wyden and I introduced the Internet Tax Freedom Act as a permanent ban on new, multiple, and discriminatory taxes on the Internet, our purpose was to nip in the bud the incipient efforts of some thirty thousand tax jurisdictions to lay claim to a piece of the Internet. At the time this was a very real threat."

Rep. Cox continued that when the Internet Tax Freedom Act was being considered, State and local officials "warned that a cruel winter would set in unless they were allowed to impose new, multiple or discriminatory taxes on the net. They warned of frozen sales tax revenues, or even falling sales tax revenues. And, they predicted the law would have a chilling effect on the business climate for Main Street brick and mortar businesses."

"But now, as we enter into the second year of this moratorium, we are about a year and a half into it, we know that is not what happened at all. The real effects that the moratorium has had are just the opposite. Sales and taxes connected to them are up, way up. The Internet economy is sizzling hot."

"Once again you see a bipartisan front around the proposition that you cannot stuff the New Economy into a set of rules that were written for a time of smoke stack industry.," said Sen. Wyden at the press conference.

Sen. Ron Wyden

Sen. Wyden also reviewed the testimony from a hearing in the Senate Budget Committee on February 2, and conversations he has had since. "Governor Engler, ... who has been concerned about our legislation in the past, said in response to a question that I asked that he personally could support a permanent ban on discriminatory Internet taxes. And I think that is a very promising development, and as a result of it, after the hearing was over, I called up Jim Gilmore, the Governor who of course has been working closely with us, and he heads the Commission."

"On the basis of what happened yesterday, and the conversations that I have had with Governor Gilmore, and with administration officials in the last twenty-four hours, I personally am hopeful that the centerpiece of the Advisory Commission's recommendations to us, ... will be support for the Cox Wyden legislation that permanently bans discriminatory Internet taxes," said Sen. Wyden.

The Internet Tax Freedom Act provided for the creation of an Advisory Commission on Electronic Commerce. It is scheduled to meet again on March 18, and issue its final report on April 19.

Rep. Bob Goodlatte (R-VA) was the third speaker at the event. "The growth and potential of the Internet and online commerce is boundless and should not be inhibited. By the year 2003, the Internet economy is expected to grow to almost $3 trillion, and electronic retail sales to consumers worldwide are expected to grow to more than $108 billion. These numbers are truly astounding. The United States is the primary beneficiary of this dramatic economic growth reflected in thousands of new companies and millions of new jobs. We must continue to ensure that the Internet remains free from reckless, restrictive taxation by making the tax moratorium permanent," said Rep. Goodlatte.

The Senate bill, S 2028, is being sponsored by Sen. Wyden, and cosponsored by Sen. Spencer Abraham (R-MI) and Sen. Pat Leahy (D-VT).

A member of the press asked when there would be a vote on the bill. Rep. Cox said "April 15 is our working deadline." Sen. Wyden said "I hope to have a vote early in the Spring."