[IP] Government study: VoIP, video can be taxed
Begin forwarded message:
From: Kurt Albershardt <kurt@xxxxxx>
Date: January 27, 2006 12:31:35 AM EST
To: dave@xxxxxxxxxx
Subject: Government study: VoIP, video can be taxed
By Anne Broache
URL: <http://news.zdnet.com/2100-9588_22-6031256.html>
State and local governments may be able to tax certain aspects of
Internet use under an existing federal law designed to ban such fees,
government auditors said this week.
The comments came in a new Government Accountability Office study
<http://www.gao.gov%2Fnew.items%
2Fd06273.pdf&siteId=22&oId=2102-9588_22-6031256&ontId=9588&lop=nl.ex>
commissioned by Congress to examine a law known as the Internet Tax
Freedom Act.
First passed in 1998 and renewed after some debate in 2004, the law
prevents state and local governments from taxing "a service that
enables users to access content, information, electronic mail or
other services offered over the Internet."
Services like voice over Internet Protocol (VoIP), traditional
telephone service and video offerings by Internet service providers
remain fair game for taxation under the law, the GAO said. The scope
of the moratorium has nothing to do with sales taxes for Internet
purchases.
At issue is the auditors' finding that the tax ban doesn't apply to
"acquired services"--in short, the actual wires, cables, fibers and
other hardware used to carry Internet traffic to customers. That
means an Internet service provider that leases fiber from a
telecommunications company for its network could theoretically be
subject to taxes during that "wholesale" transaction.
"We acknowledge that others have different views about the scope of
the moratorium," the report said. "Congress could, of course, deal
with this issue by amending the statute to explicitly address the tax
status of acquired services."
...
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