Ban on Internet Tax Approved in USA

February 12, 2016 Taxation in USA

WASHINGTON D.C. – New legislation to ban internet taxes has been approved in the USA, although no progress has been made in regards to internet taxes on mobile devices or on sales taxes on online purchases.

On February 11th the Senate of the USA passed the Permanent Internet Tax freedom Act, which bans the imposition of taxes on internet connections, and puts a deadline on any internet taxes which are already being levied.

Previously no state or local government in the USA could impose a tax on internet connections, but the ban was not permanent, and, instead, was a moratorium which was extended in 2001, 2004, 2007, and 2014.

The new Act has now permanently banned internet taxes, and also further required that any tax already imposing such taxes stop such measures by June 30th 2020.

Currently Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Texas and Wisconsin impose internet tax.

The new ban on internet taxes does not in any way effect the currently controversial issue of collection of sales taxes on online purchases made in the USA.

Proponents of the permanent ban on internet taxes have hailed the passing of the Act, but not that the change does not deal with any internet taxes provided as part of a wireless service, and that the issue of internet taxes on mobile devices still needs to be addressed.

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