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Email Tax Coming

NY Times | May 28, 2007 
Brendan Carlin and John Steele

The era of tax-free e-mail, Internet shopping and broadband connections could end this fall, if recent proposals in the U.S. Congress prove successful. State and local governments this week resumed a push to lobby Congress for far-reaching changes on two different fronts: gaining the ability to impose sales taxes on Net shopping, and being able to levy new monthly taxes on DSL and other Internet-service connections. One senator is even predicting taxes on e-mail.

Pro-tax advocates this week advanced a flurry of proposals pushing in that direction. A bill was introduced that would usher in mandatory sales tax collection for Internet purchases. Then, during a House of Representatives hearing the same day, politicians weighed whether to let a temporary ban on Net access taxes lapse when it expires on November 1. A House backer of another pro-sales tax bill said to expect a final version by July.

The response to the moves in CNET News.com's TalkBack forum was overwhelmingly negative, mostly along antitax convictions. However, some readers took a bigger-picture approach to the situation.

"Half the reason the Internet has become so successful is because the government has had little involvement."
-- CNET News.com reader

"Half the reason the Internet has become so successful is because the government has had little involvement," wrote one reader to the forum.

The U.S. Congress is also poised to create a set of massive new government databases that all employers must use to investigate the immigration status of current and future employees or face stiff penalties. The so-called Employment Eligibility Verification System would be established as part of a bill that senators began debating on Monday. The procedure that is likely to continue through June and would represent the most extensive rewrite of immigration and visa laws in a generation.

Because anyone who fails a database check would be out of a job, the proposed database already has drawn comparisons with the "no-fly list" and is being criticized by civil libertarians and business groups.

All employers--at least 7 million, according to the U.S. Chamber of Commerce--would be required to verify identity documents provided by both existing employees and potential hires, the legislation says. The data, including Social Security numbers, would be provided to Homeland Security, on penalty of perjury, and the government databases would provide a work authorization confirmation within three business days.

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