Anti-tax group warns of Internet taxation

A National Taxpayers Union study has identified several unresolved tax issues that it says could threaten online commerce. NTU advocates lower taxes, less wasteful spending and government accountability. "Within the next three months, Congress could make choices that will affect Internet taxation and the Information Age for years," said study author and NTU Policy Associate Paul Gessing. He contends that upcoming legislation to extend the federal moratorium prohibiting state and local Internet service taxes will serve as a key indicator of how other online tax issues, such as applying blanket sales taxation to e-commerce, will be resolved. Gessing's study recommends Internet tax policy options for Congress:
-- Maintain the status quo;
-- Exempt e-commerce from sales taxes;
-- Strengthen nexus rules (This proposal was introduced as legislation in the 106th Congress by Sens. Gregg and Kohl.); and
-- Adopt origin-based taxation.