News and Insights

Internet Tax Freedom Act Update: With Spending Bill, House Extends Moratorium on Taxing Internet Access

Tax Development Dec 18, 2015

The Internet Tax Freedom Act (ITFA), which bars states from enacting new taxes on Internet access, was included in the omnibus spending package that passed both houses of Congress today. The spending package had been extended by continuing resolution last week, incidentally avoiding the scheduled expiration of ITFA on December 11th. The passage of the omnibus spending bill extends the moratorium on new taxes for Internet access until October 2016. The White House has previously said it would sign the bill, which is the final step in the legislation becoming law.

On December 11th, the House passed an unrelated trade bill that contained language providing for the Permanent Internet Tax Freedom Act (PITFA), which would have struck entirely the expiration provisions that force reconsideration of the ITFA every few years. However, this week, the Senate appears to have removed such language from the trade bill, and with ITFA’s scheduled expiration postponed another year by the spending package, the discussion of PITFA appears to have moved into next year as well.

TECHNICAL INFORMATION CONTACT:

Jeremiah T. Lynch
Principal
Ryan
212.871.3901
jeremiah.lynch@ryan.com