Bush Wants Internet To Stay Tax Free

The Bush administration wants Congress to extend a moratorium on Internet taxation that is set to expire in November, Treasury Secretary John Snow said Thursday.

Snow, speaking at a gathering of technology company executives, said he and Commerce Secretary Don Evans will submit a letter to Congress urging the moratorium remain in effect.

He did not say how long of an extension the administration would seek.

"We have an administration that values you, values what high-tech industries do," Snow told about 500 members of the Northern Virginia Technology Council.

The issue of taxing sales conducted over the Internet has been controversial. Many state governments seeking additional revenue to close budget deficits have been eyeing Internet sales, which continue to grow.

Supporters of the moratorium argue that Internet commerce is still in its nascent stages and needs to be cultivated, and that allowing states to impose sales taxes will curb growth in the sector.

Snow's announcement came at the end of a speech in which he plugged Mr. Bush's tax cut bill, which is being debated in Congress.

He said the tax cut is necessary to bolster what he termed "a soggy (economic) recovery, a wobbly recovery, a recovery leaving too many people behind."

In particular, Snow argued for Mr. Bush's proposal to eliminate the tax on stock dividends. He said eliminating the tax would boost the stock market, and America's economic morale along with it.