Tax Report is an Insult to Democracy —continued

Corporations Supported it
Dean Andal, California State Board of Equalization chairman, C. Michael Armstrong, AT&T Corp. chairman, Virginia Governor James Gilmore, Paul Harris of the Virginia House of Delegates, Grover Norquist, Americans for Tax Reform president, Richard Parsons, Time Warner, Inc. president, Bob Pittman, AOL president, David Pottruck, Charles Schwab Corp. president, John Sidgemore, MCI WorldCom vice chairman, and Theodore Waitt, Gateway, Inc. Chairman, supported the ACEC final report.

States Opposed it
Delana Jones, Washington County Oregon Supervisor, Ronald Kirk, Mayor City of Dallas, Utah Governor Mike Leavitt, Gene LeBrun, National Conference of Commissioners on Uniform State Laws chairman, Washington Governor Gary, and Stanley S. Sokul for the Association for Interactive Media, opposed approving the ACEC final report.

Clinton appointees Pincus, Guttentag and Novick abstained from voting to accept the commission's report, ensuring there would not be a "super majority" on formal recommendations.

What It Was

Following are three formal recommendations and five majority proposals from the ACEC report submitted to Congress.

Formal Recommendations:

Digital Divide:

Clarify federal welfare guidelines expressly to permit the states to spend Temporary Assistance to Needy Families Program (TANF) surpluses to provide needy families access to computers and the Internet, and to provide training in computers and Internet use in order to span the "Digital Divide."

Encourage states and localities to partner with private technology companies to make computers and the Internet widely accessible for needy families, libraries, schools, and community centers and to train needy families how to use computers and the Internet. Incentives for these partnerships may include federal and state tax credits and incentives for private technology companies that partner with state and local governments and federal matching funds for state and local expenditures.

Encourage the Administration and Congress to continue gathering data for empirical research that will inform federal, state and local policymakers on measures that will lead to the reduction, and eventual elimination, of the Digital Divide by empowering families in rural America and inner cities to participate in the Internet economy.

Privacy:

Explore the privacy issues involved in the collection and administration of taxes on e-commerce, with special attention given to the costs that any new system of revenue collection may have upon other values that U.S. citizens hold dear.

Take great care in the crafting of any laws pertaining to online privacy, because policy missteps could endanger U.S. leadership in worldwide e-commerce.

International Taxes and Tariffs:

Support implementing and making permanent a standstill on tariffs at the earliest possible date.

Majority Proposals:

Internet Sales and Use Taxes:

Extend the current moratorium barring multiple and discriminatory taxation of e-commerce and prohibit taxation of sales of digitized goods and products and their non-digitized counterparts for five-years.

Clarify factors that establish a seller's physical presence in a state for purposes of determining whether a seller has sufficient nexus with that state to impose collection obligations.

Encourage state and local governments to work with and through the National Conference of Commissioners on Uniform State Laws to draft a uniform sales and use tax act that would simplify taxation policies.

Establish a new advisory commission responsible for oversight of the progress of NCCUSL's efforts to create a uniform sales and use tax act.

Internet Access:

Make the current moratorium on any transaction taxes on the sale of Internet access permanent.

Telecom Taxes:

Eliminate the 3 percent federal excise tax on communications services.

Eliminate excess tax burdens on telecommunications real, tangible and intangible property. Afford similar treatment of telecommunications infrastructure in states that exempt purchases of certain types of business equipment from sales and use taxes.

Encourage state and local governments to work with and through NCCUSL in drafting a uniform telecommunications state and local excise tax act, within three years, that would require states to follow one of two simplified tax structure models.

Previous Articles on the ACEC

[April 3] Taxing Commission Reports to Congress

[March 21] Internet Taxation Deadline Looms

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