You’ve probably heard of the “No New Taxes” pledge. Well, how about a “No Tech Taxes” pledge.
It looks like that’s where presumptive Republican presidential candidate John McCain is heading.
McCain has fought against (primarily) state efforts to impose Internet access taxes and to illegitimately require vendors to collect sales taxes, much to the chagrin of the states, which see the Internet as a new treasure trove of revenue.
Access taxes are those that would be added to your Internet service provider (ISP) bill that gives you access to the Internet. And the sales taxes would be collected whether appropriate or not when you buy a product or service online. Congress has so far successfully managed to fight off attempts to impose or expand those taxes, but the reprieves have been temporary—and hard to secure.
But the McCain campaign says, “As President, he will seek a permanent ban on taxes that threaten this engine [the Internet] of economic growth and prosperity.”
In addition, McCain has pledged to ban new cell phone taxes: “John McCain understands that the same people that would tax e-mail will tax every text message—and even 911 calls. John McCain will prohibit new cellular telephone taxes.”
This is natural position for him, though it could be better.
McCain has tried repeatedly to bring more transparency to Washington, especially with regards to federal spending and earmarks. (One notable exception is the McCain-Feingold legislation limiting campaign contributions, which has made the campaign finance system less transparent.)
However, cell phone taxes—indeed, virtually all telecom taxes—are shrouded in secrecy, tucked into long and unreadable phone bills.
As a result, states can impose a range of taxes—most of them small—that can boost a cell phone bill by an average of more than 15 percent, more than twice the average state sales tax. That’s why refusing to allow any new cell phone taxes is a bold move—one that states won’t like.
But it doesn’t go far enough. McCain’s pledge is against “new” cell phone taxes, which leaves existing taxes in place. As long as he’s ticking off the states, why not just end discriminatory cell phone taxes?
Either way, we’re delighted that someone is talking about tech tax issues, and we’re glad that at least one of the candidates recognizes that new and higher taxes have a negative impact on economic growth.