Multistate – US Internet Tax Ban Expires October 1, 2015 by David Kravets

“When the moratorium was first enacted during the Clinton administration, it was done as a move to allow the burgeoning Internet industry to blossom. States that already taxed Internet access—Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Texas, and Wisconsin—had been grandfathered in and allowed to tax ‘Net access. But under the measure approved Tuesday, those states would no longer be able to collect such taxes. The Congressional Budget Office said that amounts to “several hundred million dollars annually.”

The House passed similar legislation last term. But the measure faced resistance in the Senate where lawmakers wanted to pair it with the Marketplace Fairness Act—legislation allowing states to collect sales taxes on online purchases, even if the online retailer is not within the state where goods were purchased. By some estimates, the states are losing about $34 billion a year in sales taxes because of Internet commerce.”

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