Internet bills get second look in Congress

In a recent flurry of activity, members of the House and Senate have introduced bills targeting Internet taxation, online gambling, spam and Internet privacy. The catch is that they are for the most part virtually identical to bills that fell short of passage last year.

What has changed? Well, the bills' sponsors believe the ubiquity of the Internet in our daily lives. Last year most of these bills cleared the House only to fall short in the Senate, a more deliberative body where with filibuster rules one needs 60 out of 100 votes to move most legislation.

With new tech-savvy senators such as former RealNetworks executive Maria Cantwell of Washington and former tech investor Jon Corzine of New Jersey, along with a more active Senate Internet Caucus led by Sens. Conrad Burns and Patrick Leahy, the hope is that this year the Senate won't see Internet bills face the same fate as so many dot-coms in 2000.

The greatest time pressure is on proponents of extending the current moratorium on taxes targeting the Internet. The current moratorium expires in October, and its sponsors have renewed last year's failed effort to get an extension.

Sen. Ron Wyden, D-Ore., and Rep. Christopher Cox, R-Calif., have together introduced bills in their respective houses that would extend the moratorium for five years, permanently ban Internet access taxes, and encourage states and localities to streamline their sales taxes so that online merchants could more easily collect them.

"Chris and I want to continue the e-commerce boom we've gotten from our ban on discriminatory taxes and make sure Internet access is never subject to an arbitrary tax scheme. We also want to extend an olive branch to the states" that fear the loss of sales tax receipts, Wyden said.

Sen. Robert Smith, R-N.H., has introduced two bills on Internet taxes, one calling for another five-year moratorium, the other calling for a permanent ban. The latter approach has been favored in the past by Senate Commerce Committee Chairman John McCain, R-Ariz., but is vigorously opposed by states.

A bill that would have banned most forms of online gambling sponsored by Sen. John Kyl, R-Ariz., and Rep. Robert Goodlatte, R-Va., last year fell just short of becoming law. With online gambling sites growing at an explosive rate, however, many in Congress still would like to pass legislation on the subject.

Already introduced is a bill by Jim Leach, R-Iowa, the vice chairman of the House Financial Services Technology subcommittee and former chairman of the full committee. The bill, similar to one he introduced last year, would target financial institutions to prevent credit from being used in online gambling.

The bill by Kyl and Goodlatte took a legal approach and went after the online sites themselves, via the Internet servers that hosted their offerings.

"We're going to give it another try," Goodlatte said last week, promising a reintroduction soon.

Spam, or unsolicited e-mail, continues to drive Internet users crazy, and it drives politicians crazy as well because it's hard to craft effective legislation that doesn't run afoul of First Amendment concerns.

Still, Rep. Heather Wilson, R-N.M., fresh off a tough re-election fight for a second term, has reintroduced her anti-spam bill. That bill passed the House overwhelmingly but died in the Senate. In its final form it was combined with a bill by Rep. Gene Green, D-Texas, who has already reintroduced his bill.

Of course, one issue is already drawing a flurry of attention, as well as legislation.

"Privacy is going to be a huge issue" this Congress, Rep. Tom Davis, R-Va., predicted last week.

So far, House and Senate leaders have not lined up behind any particular legislation, but that isn't stopping bills from being introduced. Perhaps the most prominent one so far comes from Rep. Anna Eshoo, D-Calif., whose district includes Silicon Valley. Her bill lays out a formula that's growing in popularity among those seeking a compromise approach on privacy legislation.

In her bill, a Web site operator could not use any personal information about a visitor unless a privacy policy was posted and the visitor was given a chance to opt out of having the information divulged.

Congress is in recess this week, but upon its return the leadership of the key committees as well as the House and Senate leadership offices are expected to begin identifying which Internet-related bills will be placed on the fast track for passage.