New Legislation Seeks To Outlaw Taxes On VoIP

U. S. Senator John Sununu (R-NH) has filed a bill that would treat Voice Over Internet Protocol (VoIP) as "an information service," a move that could block federal and state

April 5, 2004

1 Min Read
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U. S. Senator John Sununu (R-NH) has filed a bill that would treat Voice over Internet Protocol (VoIP) as "an information service," a move that could block federal and state jurisdictions from collecting taxes on the service.

The legislation generally supports the stance of the Federal Communications Commission and presumably wouldn't interfere with the drive by some of his Republican colleagues in the Senate who want to tax Internet access. The entire VoIP arena is roiling as companies from across a broad swath of the U. S. telecommunications business race to introduce the nascent technology.

"I propose a clear, but limited federal role to enable future growth of this technology," said Sununu in a statement. "Congress must establish federal authority in this area, provide direction for any action by the FCC, and preclude individual states and jurisdictions from regulating VoIP."

A definition of VoIP as a telephone service would open it up to taxation by the federal government and states. Various state and municipal associations have complained that the loss of their ability to continue to tax telephone service -- much of it is expected to eventually move to VoIP -- will result in the loss of billions of dollars in taxes.

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