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Advisory Commission on Electronic Commerce, Report to Congress (Apr. 3, 2000) (full-text).
On April 3, 2000, the Advisory Commission on Electronic Commerce submitted its "Report to Congress." This Report reflects a extensive research into the federal, state, local and international tax and tariff treatment of electronic commerce. Among ideas proposed by the Commission included:
- Eliminate the 3% federal excise tax on telecommunications services, which would reduce the expense of Internet access, a contributing factor to the digital divide.
- Extend the existing moratorium on multiple and discriminatory taxation of electronic commerce for an additional five years.
- Prohibit taxation of digitized goods sold over the Internet.
- Make permanent the existing moratorium on Internet access taxes, including those access taxes grandfathered under the Internet Tax Freedom Act of 1998.
- Establish "bright line" nexus standards for American businesses engaged in interstate commerce. The failure to adopt "bright line" rules to the Internet economy would expose businesses to expensive and crippling regulation.
- Place the burden on states to simplify their own labyrinthine telecommunications tax systems as well as sales and use tax systems to ease burdens on interstate commerce.
- Clarify state authority to spend TANF funds to provide needy families access to computers and the Internet, as well as the training they need to participate in the Internet economy.
- Provide tax incentives and federal matching funds to states to encourage public-private partnerships to provide needy citizens access to computers and the Internet to help to close the digital divide.
- Respect and protect consumer privacy in crafting any laws pertaining to online commerce generally and in imposing any tax collection and administration burdens on the Internet specifically.
- Continue to press for a moratorium on any international tariffs on electronic transmissions over the Internet.