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ISP group studies Net taxes

A trade group of ISPs and online services announced that it is commissioning a white paper to detail the economic impact of taxation on the Internet.

A trade group of Internet service providers announced today that it is commissioning a white paper to detail the economic impact of online taxation.

The Interactive Services Association will focus on the concerns of states like Florida and municipalities like Tacoma, Washington, and Fort Collins, Colorado, that have levied or are considering levying taxes on Internet services, as well as what impact such taxes will have on electronic content and transactions.

Internet service providers are angling to avoid state and local governments that are starved for new tax revenues and are looking to the Internet to fill the void. The federal government has not made any move toward Internet taxes, but counterparts in Europe have discussed such taxes as a way to bolster revenues.

The association is hiring Big Six accounting firm Ernst & Young to write the white paper, which should be ready by October so the group will be prepared to lobby Congress on the subject during the 1997 legislative sessions. The group's members include America Online, Microsoft, Netcom, CompuServe, and AT&T.

Related stories:
Washington city taxes Internet access
New taxes threaten local ISPs