Since 1998 when it passed the Internet Tax Freedom Act (ITFA), Congress has banned state and local governments from enacting new taxes on internet access or including internet access in existing sales taxes. Now Congress is considering making the ban permanent. The House Judiciary Committee recently approved a bill that would do just that.
Permanently taking away the option of taxing internet access from states and local governments takes away the ability to raise new revenue from a growing sector of our economy for important public services like education. The Center on Budget and Policy Priorities estimates Pennsylvania loses $270,169,360 a year by failing to tax internet access.
With revenues from other sources falling, especially from corporate taxes, Pennsylvania policy-makers need the ability to consider other options to fund crucial state government services and balance the budget. This year’s state budget will not fund state government for the full fiscal year, but that could have been eased with new revenue by simply extending the sales tax to internet access.
Permanently banning taxes on internet access is the exact wrong way to go. Congress should instead lift the ban and let state and local governments decide whether or not to tax internet access.
You can help make sure Pennsylvania and your local government have the choice to raise new funds for important public services and education from an internet access tax by contacting your member of the U.S. House of Representatives and urge him or her to oppose IFTA.