Three New Ways Government Threatens to Tax the Internet - As Soon As Thursday

Warning: Taxes Are Even More
Frequent Than They Appear

by Seton Motley, Contributing Author: Perhaps the only thing government loves more than spending our money - is taking it.

The spending has long since passed absurdly astronomical levels. The Feds alone spend about $4 TRILLION a year. Governments in total are spending about 36% of our Gross Domestic Product (GDP) - everything everyone in the nation combined creates.

As we know, government is absolutely loathe to reduce spending.
Nancy Pelosi: There is Nothing Left to Cut in the Budget That’s perversely easy to say when Washington operates under the bizarre assumption that it spends every current penny wisely and well - using “incremental budgeting.”In traditional incremental budgeting (Historic Budgeting), departmental managers justify only variances versus past years, based on the assumption that the "baseline" is automatically approved.Rather than behaving like just about every private sector entity on the planet - which uses zero-based budgeting.(I)n zero-based budgeting, every line item of the budget must be approved, rather than only changes.The Feds keep breaking records for taking our money - yet have racked up an $18+ TRILLION (and counting) debt. Government doesn’t have a revenue problem - it has a spending one. It needs to find ways to stop being so ridiculously profligate - rather than looking for new ways to take our money.

But as we know, that ain’t happening. Government views our money like Jello - there’s always room for more. Whenever it can raise taxes - or create new ones - it all but leaps at the opportunity.

The Internet is currently threatened with multiple brand new taxes levied by multiple levels of government.

One tax tidal wave can happen by Washington simply doing nothing. On Thursday, the federal moratorium on Internet access taxes expires. The House of Representatives long ago passed - by mega-bipartisan voice vote acclimation - the Permanent Internet Tax Freedom Act (PITFA). Which will once and for all stop this particular government blood-letting.

The lame duck Senate must now pass PITFA and get it to the President’s desk. Except:
Harry Reid Remains Obstinately, Perversely Insistent on Taxing the Internet

…Instead of putting the same (PITFA) bill to the Senate, …Reid has decided to attach it to a proposed law called the Marketplace Fairness Act (MFA). That bill…would require online retailers to collect tax on sales they make to out-of-state consumers (subjecting these retailers to 9,998 different tax jurisdictions).

Get that? Under the MFA, uber-tax-happy states like California would no longer be confined to taxing into oblivion just Californians. They’d have access to the wallets of every business - every person - in all fifty states.

Turning Huge Government states into additional Huge Government federals. And tempting Less-Huge-Government states to grow - with the siren song of new coin taken from people in forty-nine states that can’t vote them out of office.And as huge as these new taxes are - they aren’t the hugest prospective new tax.

If President Barack Obama and the leftist of the Left (like the aforementioned Pelosi) get their way, the Feds will soon begin slamming the ridiculous, bloated, wasteful, utterly unnecessary Universal Service Fund (USF)’s gi-normous phone tax - onto the Internet.

These uber-Leftists want President Obama’s Federal Communications Commission (FCC) to unilaterally rewrite existing law - to seize sweeping new authority over the Internet. They call it Title II “Reclassification” - we call it authoritarianism.

The FCC would then apply 1930s landline phone law to the Web. Which is untenable from a regulatory standpoint - and a taxation one.
Under Title II, President Obama can…begin to tax the Internet - just as the Feds tax landlines, just as they already tax the living daylights out of your wireless Internet….That’s the USF tax - which is currently 16.1%. And it goes up every quarter - automatically.

Unless the FCC bureaucrats don’t want to wait for the automatic increase - and unilaterally raise it themselves. Also on Thursday:
FCC Poised to Bust the USF Budget

At its forthcoming (December 11) meeting…, the FCC almost certainly will scrap the current $8+ billion ceiling on the Universal Service Fund (USF) and increase program expenditures to nearly $10 billion annually….

(Republican FCC) Commissioner (Ajit) Pai…has opposed the enlarged program as an unjustified “17.2% tax increase”….Get that? Three unelected Democrat FCC bureaucrats can any time they want unilaterally raise taxes on phones.

Which means post-Title II Reclassification - three unelected Democrat FCC bureaucrats will be able any time they want to unilaterally raise taxes on the Internet.

Which of course they will. Over, and over, and over again. It’s their Jello.
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Seton Motley is the President of Less Government and he contributes to ARRA News Service. Please feel free to follow him him on Twitter   /   Facebook.

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