Internet Tax Moratorium in Jeopardy (Dec 2001)

September, 2002


A long-term policy for the tax treatment to be applied to online transactions continues to elude federal legislators. Leaders in Congress are scrambling to give themselves, and the states, more time to reach a consensus. The House Judiciary Committee introduced a tax moratorium extension measure, which would extend the ban on placing duplicative or discriminatory taxes on Internet services for two years. A similar two-year extension has been proposed in the Senate, where a compromise eight-month extension was rejected just days before the end date for the original tax moratorium. With that rejection, the moratorium expired on October 21, 2001.