Congress Inks Pact On Permanent Internet Access Tax Ban

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WASHINGTON (AP) - House and Senate negotiators have reached agreement on bipartisan legislation to make permanent a moratorium that prevents states from taxing access to the Internet.

The moratorium was first enacted in 1998. State and local governments that already had Internet taxes were allowed to keep them under the current moratorium, but under the new agreement, jurisdictions with Internet taxes would be required to phase them out by mid-2020.

Jurisdictions in seven states -- Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Texas and Wisconsin -- tax access to the Internet, according to the non-partisan Congressional Budget Office. Together they would lose "several hundred million dollars annually" if they were no longer allowed to collect the taxes.

The Internet tax moratorium was attached to a separate measure modernizing the U.S. customs system.

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