From Wired:
Sen. John McCain (R-Arizona) worked Friday to revive a bill banning taxes on Internet connections, a measure that bogged down last year amid worries that state and local governments could lose billions in tax revenue.
Senators have been battling since a temporary ban ran out nearly six months ago.
McCain, the chairman of the Commerce Committee, would propose banning taxes for four years on services that connect the consumer to the Internet, said congressional officials speaking on condition of anonymity. States exempted from the original ban, enacted in 1998, would be given three years to eliminate their taxes. States that tax DSL connection services would have two years to end their levies.
Congress first barred taxes on Internet connections in 1998. Technologies never envisioned then now let consumers enjoy faster services, download movies and music and leave their wired connections behind. Some companies have started offering traditional telephone services using Internet technology.
Here's the line I don't like:
"...a measure that bogged down last year amid worries that state and local governments could lose billions in tax revenue."
Lose billions of dollars in tax revenue? How are they going to lose it if they're not receiving revenue from such taxes in the first place? Why on earth do Americans need more taxes? Are local governments being faced with some major expenditures that ordinary property, sales and income taxes can't cover? Is there really any need to bilk citizens out of another few bucks a month other than bureaucratic greed? Americans need another tax like they need another hole in the head.
The internet has become a thriving business venture for a lot of companies. I would even venture to say that the internet is a big factor in our economy. If we start raising the costs associated with the internet its only going to create problems for the companies doing business over the internet which would lead to problems in our economy. Once we open the door to allow local governments to tax the internet they're never going to stop. We're going to be seeing taxes on ISP's and email accounts. Heck, even website operators may have to pay a tax for every website they maintain.
Leave the money in the taxpayer's pockets. The government already gets enough money.