XBIZ_News

WASHINGTON — The House of Representatives overwhelmingly approved a four-year extension of a moratorium on state and local taxes on Internet access by a vote of 405-2 on Tuesday.

The moratorium would continue to forbid state and local governments from taxing Internet access, including DSL, cable modem and Blackberry-type wireless transmission services.

The tax ban, which was first passed in 1998, was set to expire on Nov. 1. The extension that just passed exempts states that had approved taxes prior to the original enactment.

A bill that would make the ban permanent was reintroduced in the Senate last week.

"This bill is pro-consumer, pro-innovation and pro-technology," said Rep. Mel Watt, D-N.C., one of the bill's sponsors. Watt noted the bill also will allow lawmakers to make changes as needed, as has occurred the two times the moratorium has been extended since 1998.

Another bill that would make the moratorium permanent has 238 House co-sponsors. Rep. Lamar Smith, R-Texas, said a permanent ban would ensure that businesses would continue to invest in the Internet and keep access affordable for users.

The bill must be passed by the Senate and signed by the president to become law. In late September, a bill that would have extended the moratorium for four years was removed from consideration by the Senate Commerce Committee.

The bill is HR 3678.

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