NTU to Congress: Customs Bill Offers Huge Win for Taxpayers by Banning Taxation of Internet Access

Conferees recently completed the conference report for H.R. 644, the Trade Facilitation and Trade Enforcement Act of 2015, a bill initially conceived to modernize and streamline the customs process.  Though the timing is fluid, the House is scheduled to vote on the conference report this week, while the Senate will likely take up the measure early next week. National Taxpayers Union (NTU) strongly supports the conference report.

During the debate on the original legislation, a number of conservatives offered some sensible objections to the bill. The Senate’s version, for instance, included a provision that would have required the Department of Commerce to classify currency manipulation by foreign countries as an export subsidy and thus trigger countervailing duties. Legislative attempts to impose penalties on countries for alleged currency manipulation are grounded in misguided economics – they would trigger a trade war and hamper U.S. consumers who would be forced to pay more goods.

Nevertheless, different versions of the customs bill passed each chamber, setting up a conference committee to resolve differences. Thankfully the conference report does not contain the Senate’s ill-advised currency manipulation provisions.

Though H.R. 644 is aimed at modernizing the country’s customs processes, conferees surprisingly included a huge early Christmas present for taxpayers: a permanent ban on Internet access taxes. Since 1998, Congress has passed temporary bans on states and localities taxing access to the Internet. With the passage of the conference report, Congress can permanently eliminate the threat of higher taxes for consumers. If enacted, this would be a monumental – and long overdue – victory for taxpayers.

The Internet has been an engine for economic growth and it is a beautiful testament to the power of capitalism to better the lives of people all over the globe. It has succeeded in part because it operates in a relatively light tax and regulatory environment. Congress can further improve that environment by passing a permanent ban on taxing Internet access.

NTU urges all Members of Congress to support the Conference Report for H.R. 644, and especially Members who voted against the initial customs bill. Simply put, permanently eliminating internet taxes vastly outweighs any lingering concerns that may exist regarding changes to customs policy.