[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2084 Introduced in Senate (IS)]
108th CONGRESS
2d Session
S. 2084
To revive and extend the Internet Tax Freedom Act for 2 years, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 12, 2004
Mr. Alexander (for himself, Mr. Carper, Mr. Dorgan, Mrs. Feinstein, Mr.
Graham of Florida, Mr. Hollings, Mrs. Hutchison, Mr. Inouye, Mr.
Lautenberg, Mr. Rockefeller, and Mr. Voinovich) introduced the
following bill; which was read twice and referred to the Committee on
Commerce, Science and Transportation
_______________________________________________________________________
A BILL
To revive and extend the Internet Tax Freedom Act for 2 years, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Internet Tax Ban Extension and
Improvement Act''.
SEC. 2. 2-YEAR EXTENSION OF MORATORIUM.
Section 1101(a) of the Internet Tax Freedom Act (47 U.S.C. 151
note) is amended--
(1) by striking ``2003--'' and inserting ``2005:'';
(2) by striking paragraph (1) and inserting the following:
``(1) Taxes on Internet access.''; and
(3) by striking ``multiple'' in paragraph (2) and inserting
``Multiple''.
SEC. 3. EXCEPTIONS FOR CERTAIN TAXES.
The Internet Tax Freedom Act (47 U.S.C. 151 note) is amended--
(1) by redesignating section 1104 as section 1105; and
(2) by inserting after section 1103 the following:
``SEC. 1104. EXCEPTIONS FOR CERTAIN TAXES.
``(a) Pre-October, 1998, Taxes.--Section 1101(a) does not apply to
a tax on Internet access (as that term was defined in section 1104(5)
of this Act as that section was in effect on the day before the date of
enactment of the Internet Tax Ban Extension and Improvement Act) that
was generally imposed and actually enforced prior to October 1, 1998,
if, before that date, the tax was authorized by statute and either--
``(1) a provider of Internet access services had a reasonable
opportunity to know by virtue of a rule or other public
proclamation made by the appropriate administrative agency of
the State or political subdivision thereof, that such agency
has interpreted and applied such tax to Internet access
services; or
``(2) a State or political subdivision thereof generally
collected such tax on charges for Internet access.
``(b) Taxes on Telecommunications Services.--Section 1101(a) does
not apply to a tax on Internet access that was generally imposed and
actually enforced as of November 1, 2003, if, as of that date, the tax
was authorized by statute and either--
``(1) a provider of Internet access services had a reasonable
opportunity to know by virtue of a rule or other public
proclamation made by the appropriate administrative agency of
the State or political subdivision thereof, that such agency
has interpreted and applied such tax to Internet access
services; or
``(2) a State or political subdivision thereof generally
collected such tax on charges for Internet access service.''.
SEC. 4. CHANGE IN DEFINITIONS OF INTERNET ACCESS SERVICE.
(a) In General.--Paragraph (3)(D) of section 1101(e) of the
Internet Tax Freedom Act (47 U.S.C. 151 note) is amended by striking
the second sentence and inserting ``The term `Internet access service'
does not include telecommunications services, except to the extent such
services are purchased, used, or sold by an Internet access provider to
connect a purchaser of Internet access to the Internet access
provider.''.
(b) Conforming Amendments.--
(1) Paragraph (2)(B)(i) of section 1105 of that Act, as
redesignated by subsection (a), is amended by striking ``except
with respect to a tax (on Internet access) that was generally
imposed and actually enforced prior to October 1, 1998,''.
(2) Internet access.--Paragraph (5) of section 1105 of that
Act, as redesignated by subsection (a), is amended by striking
the second sentence and inserting ``The term `Internet access'
does not include telecommunications services, except to the
extent such services are purchased, used, or sold by an
Internet access provider to connect a purchaser of Internet
access to the Internet access provider.''.
(3) Paragraph (10) of section 1105 of that Act, as
redesignated by subsection (a), is amended to read as follows:
``(10) Tax on internet access.--
``(A) In general.--The term `tax on Internet
access' means a tax on Internet access, regardless of
whether such tax is imposed on a provider of Internet
access or a buyer of Internet access and regardless of
the terminology used to describe the tax.
``(B) General exception.--The term `tax on Internet
access' does not include a tax levied upon or measured
by net income, capital stock, net worth, or property
value.''.
SEC. 5. ACCOUNTING RULE.
The Internet Tax Freedom Act (47 U.S.C. 151 note) is amended by
adding at the end the following:
``SEC. 1106. ACCOUNTING RULE.
``(a) In General.--If charges for Internet access are aggregated
with and not separately stated from charges for telecommunications
services or other charges that are subject to taxation, then the
charges for Internet access may be subject to taxation unless the
Internet access provider can reasonably identify the charges for
Internet access from its books and records kept in the regular course
of business.
``(b) Definitions.--In this section:
``(1) Charges for internet access.--The term `charges for
Internet access' means all charges for Internet access as
defined in section 1105(5).
``(2) Charges for telecommunications services.--The term
`charges for telecommunications services' means all charges for
telecommunications services except to the extent such services
are purchased, used, or sold by an Internet access provider to
connect a purchaser of Internet access to the Internet access
provider.''.
SEC. 6. EFFECT ON OTHER LAWS.
The Internet Tax Freedom Act (47 U.S.C. 151 note), as amended by
section 4, is amended by adding at the end the following:
``SEC. 1107. EFFECT ON OTHER LAWS.
``(a) Universal Service.--Nothing in this Act shall prevent the
imposition or collection of any fees or charges used to preserve and
advance Federal universal service or similar State programs--
``(1) authorized by section 254 of the Communications Act
of 1934 (47 U.S.C. 254); or
``(2) in effect on February 8, 1996.
``(b) 911 and E-911 Services.--Nothing in this Act shall prevent
the imposition or collection, on a service used for access to 911 or E-
911 services, of any fee or charge specifically designated or presented
as dedicated by a State or political subdivision thereof for the
support of 911 or E-911 services if no portion of the revenue derived
from such fee or charge is obligated or expended for any purpose other
than support of 911 or E-911 services.
``(c) Non-Tax Regulatory Proceedings.--Nothing in this Act shall be
construed to affect any Federal or State regulatory proceeding that is
not related to taxation.''.
SEC. 7. EFFECTIVE DATE.
The amendments made by this Act take effect November 1, 2003.
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