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[IP] more on IRS eyes Net phone taxes





Begin forwarded message:

From: Bob Frankston <Bob2-0406@xxxxxxxxxxxxxxxxxx>
Date: July 8, 2004 2:57:55 PM EDT
To: dave@xxxxxxxxxx, 'Ip' <ip@xxxxxxxxxxxxxx>
Cc: "David P. Reed" <dpreed@xxxxxxxx>, 'Dewayne Hendricks' <dewayne@xxxxxxxxxxxxx>
Subject: RE: [IP] more on IRS eyes Net phone taxes

I remember when I visited Jamaica last year at a meeting hosted by their regulatory commission but what struck me is the idea of presuming a need to regulate.

 

The taxation imperative is closely related. I don't want to get into fundamental philosophical issues so am assuming that there is need for revenue and ignoring how the funds are earmarked.

 

Just as the Telcos' real skill is in creating billable entities politics is the art of finding taxable entities that raise the least political controversy. Email escaped taxation because it is perceived as fundamentally different from postal mail. As long as people see telephony as a business rather than a technology and VoIP as just a minor variation it will be hard to explain why it should be exempt from taxes that have already been accepted whatever their origins.

 

This is the same as the piracy framing that sets us to consider those who might add value as being thieves rather than creators themselves.

 

This is why I’m glad that Skype exists and doesn’t look at all like traditional telephony. Their machine-machine communications is not new but it is well done and can be used instead of the telephony as long as both parties are at their PCs.

 

As long as VoIP is perceived to be a trick to get past rules those who seek to tax it are doing their duty. They are representing their constituents in maintaining the status quo.

 

It is our responsibility to educate them and/or their constituents. Or we can wait this one out until the PSTN fades away. Unfortunately it is cellular telephony that keeps the PSTN alive. Cellular is under extremely tight control. To get real change we have the bigger challenge of getting past the myth of spectrum allocation. Makes explaining VoIP seem easy.

 

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