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Lawmakers Introduce Bill to Extend Internet Tax Ban

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Three U.S. lawmakers on Tuesday introduced a bill that would permanently extend a ban on Internet-only taxes, including taxes on Internet access.

The legislation would ban three types of taxes that single out the Internet: taxes on Internet access, multiple taxation by two or more states of a product or service bought over the Internet, and taxes that treat Internet purchases differently from other types of sales.

"It's important that we take a stand right here and now to make sure that we say that the United States of America and the Internet will be a no-tax zone, now and forever," said Senator George Allen, a Virginia Republican and one of the bill's sponsors. Senators Ron Wyden, an Oregon Democrat, and Representative Christopher Cox, a California Republican, co-sponsored the bill.

The bill would extend a current Internet tax moratorium that is due to expire in 2007.

Supporters of the Internet Tax Non-Discrimination Act in 2004 attempted to permanently ban what supporters call "discriminatory" Internet taxes, but a group of U.S. senators held up the bill because of concerns that it would stop states from taxing forms of telecommunications transmitted by Internet Protocol, as more telecom providers move traffic to voice over IP. In a compromise, the Senate approved a version of the bill that extended a five-year ban against Internet-only taxes levied by states and local governments.

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