Coming next week: A tax on your e-mail?

Editor's note: Click here for Friday's update on the Senate's Internet access tax vote.

When the U.S. House of Representatives overwhelmingly passed a bill last week extending a ban on Internet access taxes, it may have opened up the possibility of previously forbidden taxes on paid e-mail and other Web services.

That's what a Congressional Research Service attorney concluded in a two-page memorandum (click here for a PDF) released on Thursday by Sen. Ron Wyden (D-Ore.), the author of the original tax ban in 1998. The CRS is a federally funded sort of "think tank" charged with conducting nonpartisan reports and analysis for Congress.

The specter of an e-mail tax all comes down to how the bills define what the ban covers.

Current law, which is set to expire on November 1 unless Congress acts, defines the term as "a service that enables users to access content, information, electronic mail, or other services offered over the Internet, and may also include access to proprietary content, information and other services as part of a package of services offered to users."

By contrast, the language approved by the House recently, which will potentially be considered soon by the Senate, is narrower, the CRS said. It includes e-mail and other services in the tax ban, but only if they're "incidental" to the Internet connection services that a company already provides.

That means, by the CRS' analysis, that if I'm a Verizon broadband subscriber but opt to get my e-mail service through, say, Yahoo's premium offering, the e-mail service is potentially taxable because it's not directly offered by the provider of my Internet connection.

"I know no member of the U.S. Senate who wishes to see that happen," Wyden said in a speech on the Senate floor Thursday afternoon.

He urged the politicians to take up a bill he sponsored earlier this year, which would permanently ban Internet taxes and keep the same definitions. Under that law, "the Internet has thrived and prospered," and states have not lost significant tax revenue, he argued.

With the current law's expiration date fast approaching, the Senate is still wrestling with how to proceed with consideration of the Internet tax ban proposals, weeks after the Senate Commerce Committee called off a vote on a four-year extension.

Sen. John Sununu (R-N.H.) on Wednesday made another push for a permanent tax ban, in the form of an amendment to an Amtrak funding bill. Sens. Frank Lautenberg (D-N.J.) and Tom Carper (D-Del.) immediately countered with an amendment that would limit the ban to a four-year extension.

Both amendments rely on the House-approved definition of Internet access, however, so it wasn't immediately clear how or if the senators plan to deal with the e-mail tax issue raised by Wyden and the CRS. Sununu did say, however, that he would "like to see the clearest possible language when it comes to service providers that are providing different kinds of Internet services but may not be providing Internet access services as well."

Sununu has requested a procedural vote for Friday morning on whether to end debate on his amendment and move directly to a vote on its passage. But Carper suggested on the Senate floor Thursday that the senators hold off until next week and hold up-or-down votes on Sununu's permanent ban proposal and the competing six-year extension bill. Carper and a handful of other senators, mostly Democrats, openly favor a temporary ban so that states can revisit the need to find new revenue sources in the face of changing technology.

Stay tuned to CNET News.com as we continue to track the jockeying in the countdown to the ban's scheduled expiration next week.