Senate Mulls Internet Tax Ban - VoIP Exempt? 143
securitas writes "eWEEK's Caron Carlson reports that this week the U.S. Senate will vote on renewing an Internet tax ban, but voice over IP (VoIP) may be taxed. The bill renews a state/local ban on taxing Internet services like VoIP. The federal government wants to define VoIP as a software application exempt from taxes while most states see it as an alternate form of telephony subject to telecommunications taxes. House and Senate bills that define VoIP as a software application have already been introduced but may not be voted on before the Internet tax vote."
pathetic (Score:3, Insightful)
Re:pathetic (Score:3, Funny)
Re:pathetic (Score:1)
The only way I could see them levying the tax would be to add a tax onto the software when you buy it, kind of like the video cassette tax back in the 80's.
How would they know it's a conversation? How would they differentiate between a Powwow chat and a cisco VoIP? How would they know this packet contains VoIP so it should be taxed (by who and how...but that's another matter) and this packet contains Aunt Matilda's Hallmark greeting card?
I agree with the FP, they are a bunch of money loving b
Re:pathetic (Score:3, Insightful)
What defines VoIP? (Score:5, Interesting)
What about GAIM's VoIP plugins? Or Gnomemeeting/Netmeeting?
Are we just talking about apps that mimic a telephone, or are we talking about all VoIP applications?
I don't trust Congress on these matters. I get the feeling that VoIP will end up being broadly defined and some horror stories resulting from the mess.
Re:What defines VoIP? (Score:2)
Re:What defines VoIP? (Score:3, Insightful)
Re:What defines VoIP? (Score:2)
Re:What defines VoIP? (Score:1)
Re:What defines VoIP? (Score:2)
Re:What defines VoIP? (Score:2)
Re:What defines VoIP? (Score:2)
For instance, I'm trying to help give Snarlin' Arlen Specter the boot from Pennsylvania, but the sniveling PA GOP refuses to actually stand up for supposedly "Republican" principles and is backing one of the most un-Republican senators out there, simply in the name of political expediency and clout.
Re:What defines VoIP? (Score:3, Interesting)
Sure, there are other ways to use VOIP technology, but it is totally nothing compared to the number of people who use the PSTN. My guess is they would like to position themselves to levy taxes as some telcos go from circuit switched technology to packet switched.
You're probably ri
Re:What defines VoIP? (Score:2)
Well... Let's make this simple (Score:3, Insightful)
If its a point to point connection between two users with no PSTN involvement the baby bells can go jump.
Fair? I think so.
Re:Well... Let's make this simple (Score:2)
The phone network shouldn't have been taxed to begin with.
Re:What defines VoIP? (Score:1)
Currently, "VoIP" in the government's eyes is carrier-class packet telephony implemented to replace PSTN services for consumers and business. There are companies out there, like mine, who are gaining traction delivering this type of service. Multisite companies love not paying LD charges between LATAs/states...
This really means PSTN-quality audio, without the regulated tarriffs, origination fees, and te
Re:What defines VoIP? (Score:2, Insightful)
On the other hand, taxing it at the VoIP - PSTN gateway end (bear in mind most current and short-term-future VoIP use will ultimately need to break out onto a PSTN network eventually) would probably be easier to implemnet consistently.
Maybe they'll settle on taxing PSTN bridging. (Score:3, Insightful)
The sane thing to do would be to tax subscription VoIP/PSTN bridging. (PSTN = Public Switched Telephone Network.)
VoIP computer-to-computer connection is just another IP application. It lets you communicate with another computer user - but so does just about EVERY OTHER application on the Internet. (VoIP just happens to transmit voice, rather than the text streams of chat and IM, the compositions of ema
don't they understand the word "NO"? (Score:2)
tax spam not consumer/user chosen communications... Or do I have to pay tax to say this?
Free Speech?
Re:don't they understand the word "NO"? (Score:2)
I agree about taxing spam. I say tax spam at a rate 2 times the current snail mail postage rate.
Re:don't they understand the word "NO"? (Score:1, Flamebait)
you will need to to cover the infrastructure costs of such a stupid idea
They might be right (Score:4, Interesting)
Like I said, I'm just playing devil's advocate.
Re:They might be right (Score:2, Interesting)
VoIP can be coded in a software (which can be Free, as in Free Beer), and that's why it is neither a good, nor a service.
Re:They might be right (Score:3, Insightful)
If some service provider wants to charge for a VoIP service then this provider should be taxed... but for regular "free" services taxing makes no sense.
Whats next... HTTP taxing??
Skype? (Score:5, Interesting)
How exactly do they intend to regulate the unregulatable?
Re:Skype? (Score:1)
Re:Skype? (Score:1)
Re:Skype? (Score:1)
Re:Skype? (Score:2, Interesting)
I guess you could get around this by using IPsec, OTOH.
Re:Skype? (Score:2)
Re:Skype? (Score:3, Insightful)
-->How exactly do they intend to regulate the unregulatable?
They don't. Even the pols aren't that stupid. What they will end up doing is taxing any applications that interface and crossover to the Public Switched Telephone Network (PSTN). The last time I looked Skype did not do this (and now probably won't ever do so).I wonder why (Score:5, Insightful)
These same people have been working very hard and were able to convince some PSC that rate hikes were in order. [This besides the fact that they had highly profitable quarters even during the economic down turn] Thus stuffing the war chests of the big guys, helping them roll out their "loss leaders" in an effort to crush any competition.
Now they are agitating for VoIP with no taxes. Why? Simple. They've finally agreed to come to the party. Many companies have been doing VoIP for some time, and the idea that VoIP would be taxed has been held out, but now that the RBOC's and ILECS all have made major VoIP announcements suddenly we're considering legislation! IMAGNINE THAT!
At VON this year everyone was screaming that the government should take a "hand off approach". This included a rep from the FCC, AT&T legal, california and florida PSD reps. No one wants to "kill the goose that lays the golden egg". From my POV that is ideal. Let us compete and we will crush the inefficient, lazy, technically inept RBOC and ILECS. The problem is that I don't see this hands off approach staying that way. The FCC and california PSC guy hinted that some sort fo universal access fee may be in order. The other thing that was strongly hinted at is that the state's are going to loose a larege source of recouring revenue that they can't afford to loose. so a state tax may be considered.
In the end, I see VoIP taxes heading the same way as our current PSC and FCC. Favor the big guy (ie campaign contributers), and lets not have too much competition. It wasn't more than 2 years ago when somone said that VoIP will take 2 decades to become mainstream. Sprint, AT&T, Bell South and Verizon will all be switching voice at their cores within 7.
This bill is a step in the right direction. Lets see if the congress can keep the playing field even. If they do - the RBOC's and ILECs are in trouble unless they make some fundemental changes to their corporate cultures. I bet they will protect their little fiefdoms - look for modified legislation in the next 12-18 months to give them a leg up. (As if their monopoly's weren't enough)
cluge
AngryPeopleRule [angrypeoplerule.com]
Anonymous sources have told me that... (Score:5, Funny)
Re:Anonymous sources have told me that... (Score:2)
Re:I wonder why (Score:2)
Not exactly. UNE-P is still around. The problem with it is that the ILEC's are forced to sell service under UNE-P to CLEC's at around 65% of cost. That means for every UNE-P line they sell, it costs them more money to keep up the copper/offices than they got for the line. That leads to less desire to provide it and less
SBC sues ATT over VoIP (Score:2)
Here is the full article for those of you too tired to click through:
SBC Sues AT&T Over Internet Phone Fees
Fri Apr 23, 4:56 PM ET
WASHINGTON (Reuters) - SBC Communications Inc., (NYSE:SBC) the second-largest U.S. local phone company, has sued lo
Explanation of Acronyms (Score:2)
RBOC: Regional Bell Operating Company [google.com]
ILEC: Incumbent Local Exchange Carriers [google.com]
FCC: Federal Communications Commission [google.com]
UNEP: United Nations Environment Programme [google.com]??
DSL: Digital Subscriber Line [google.com]
PSC: ??
VoIP: Voice of IP [google.com] - Internet Phone calls
VON: Voice Over Net coallition [von.org]
PSD: ??
POV: Point of View
Hopefully someone can t
Stop Taxing my electrons... (Score:4, Funny)
"Enclosed is my tax payment - you will find 1 blue LED and a battery. Turn it on and let it glow. At the end of the battery life my internet taxes will be paid in full, in several billion photons."
I think you still might be able to pay taxes in live chickens, but
that would be so unfair to the chickens!
What I would really like for VoIP... (Score:5, Interesting)
Kjella
Re:What I would really like for VoIP... (Score:2)
The cell phone becomes a "trunk".
You are right, once things like this become more common the market will explode.
Plus its just cool as hell.
IP law is not the enemy? (Score:5, Insightful)
Pointer to an article on India VoIP ban proposals? (Score:2)
That's the first I've heard of that. (And it's important to me.)
Do you have a pointer to any articles on it?
thanks
Old news (Score:2)
Don't forget you don't have to tax EVERYONE or regulate EVERYONE. All you have to do is tax and re
If they are applications... (Score:3, Funny)
the chaos of law (Score:5, Insightful)
The law of CHAOS (Score:2)
Technically, how would this be possible? (Score:4, Interesting)
This sounds more like some sort of random tax that still won't allow what you want to do with your machine, just like the blank CD tax/fees you pay still won't let you completely off the hook with the RIAA MPAA goons and their pet legislation they inspired, even though it was supposed to.
The only way to keep the net free is just that, no taxes on it for any reason. It's slippery slope, once the government gets a money toe hold on it, eventually it will be highly regulated.
And speaking of taxes and unnecessary fees, why can't we get unbundled POTS yet? Why do I have to pay all these ridiculous fees I see on my phone bill to use a phone line just for the net? I don't use it for anything but net access. I certainly can't get unbundled copper, no negotiations there as far as I know without jumping through a ton of ridiculous hoops and expense. I guess what I am asking is, why can't I be my own isp with just a pair of copper wires, why do I need all the extra fees and go through someone who has a fat pipe, is there any technical reason they can't throw some switches, etc, and just let me use PPP? Is this an artifical blockade they put on it? I honestly don't know the answer to that, not familiar enough with how it is set up at the local telco or how this is arranged beyond getting an assigned IP and/or domain name and IP. Would it be technically possible to just buy an IP directly, and eliminate a couple of middleman steps? I've never worked at an ISP or anything so I don't know what steps are involved with access and hardware and software and protocols.
Re:Technically, how would this be possible? (Score:1)
Re:Technically, how would this be possible? (Score:1)
You just start off with a couple of computers and give them a couple of IP addresses. There are two ways to go about this: completely on your own and just pick some number out of thin air (but you will not be compatible with the current Internet) or get a range from IANA (with IPv6 there are anough to get it straight from the horses mouth).
Now you connect your neighbour's computers to your own with ethernet and two routers. Now in most countries you may not lay c
Re:Technically, how would this be possible? (Score:2)
States like mine in a quandry (Score:5, Insightful)
Our govenor says that promoting small business and entrepreneurs is the key while attracting big companies like BMW.
Yet, taxing VoIP is against the sentiment entirely. I know that telephony (especially on the business side) is a VERY expensive part of my overhead. I plan on switching to Vonage soon. Taxing it would make it less of an advantage vs regular phone service.
So either our goverments want it easier to for small business to succeed due to the reduction of overhead costs that the internet brings or they don't.
It goes the same for taxes in general over the internet. Not having to collect and send in sales taxes is HUGE relief of manpower!
Re:States like mine in a quandry (Score:3, Insightful)
Re:States like mine in a quandry (Score:2)
VOIP (Score:2, Informative)
In that regard, if they want to tax VOIP providers as they do normal telco's I don't have a complaint, I'd assume that'd just be a given. But if they want to try and tax every program that could possibly send speech over the net then I'd be a bit annoyed (to put it lightly)
I wouldn't consider Skype, T
"On The Internet" should be irrelevant (Score:4, Insightful)
Re:"On The Internet" should be irrelevant (Score:2)
Re:"On The Internet" should be irrelevant (Score:2)
In case you hadn't noticed, the tax man doesn't have little spy monitors in phone, fax, mail, shopping malls, ice cream trucks, etc, either. We know about the commerce when the money changes hands and the business reports it. It's all the same thing.
Re:"On The Internet" should be irrelevant (Score:2)
Re:"On The Internet" should be irrelevant (Score:2)
Either my words are accidentally cryptic (if so, I apologize) or you are woefully misconstruing (if so, you apologize).
you are taxed at the mall because
You are taxed at the mall because the shop keeps careful records and provides those records to the state with its tax forms. Shops report tax because they risk fines and loss of license if they don't. There is no magical tax fairy watching over your visit to the mall.
The only way they know you bought something on the Internet is that some place registe
Re:"On The Internet" should be irrelevant (Score:2)
If you have a personal connection that you aren't selling to others, business law is irrelevant in that case. Is that your point?
Or are you saying that regulators have no way to track VOIP usage directly? Those same regulators have no way to track POTS or wireless usage either. The phone companies self-report because auditors and peers will catch them if they lie.
Online or
Re:"On The Internet" should be irrelevant (Score:2)
Re:"On The Internet" should be irrelevant (Score:2)
Absolutely.
Already, Internet based stores have such an incredibly low overhead, and they have such a profound on brick & mortar stores that actually do contribute to the community and local government, I think that this is a very small thing to ask for. Hell, it's all computerized already, so it's not that tough to do.
Re:"On The Internet" should be irrelevant (Score:2)
+5 Funny.
I own several successful brick & mortal retail stores, along with a new Net based store.
Re:"On The Internet" should be irrelevant (Score:2)
It amazes me how people who know little to nothing about computers are so eager to talk out of their ass about how easy something is to implement.
select billing_state, sum(sale_price) from tbl_sales where date_sold '2/1/2004' group by billing_state
Oooh, that was hard, huh? Jackass.
Hmm? Taxing a particular kind of software? (Score:2)
I wonder how they will collect the tax on an open source / free software version of a VoIP application?
15% of $0.00? Here's your 'tax' Mr./Ms. senator
I'm not sure if tax on a particular kind of software has ever been done before? I don't think it will work out that great in this case.
A Moving Target (Score:1)
Taxes are used by the government to level a playing field, reduce the impact or reduce the desirablity of something. Liquor and cigarettes are heavly taxed to help pay for the gov. services used because of those products and to reduce their desirablity.
With the Internet you have a slightly different problem. The
Re:A Moving Target (Score:2, Insightful)
and on my phone line which my DSL is on.
I pay about $20 a month just in taxes for my phone+DSL.
taxing VOIP is ridiculous since you're still paying taxes on the internet service.
as for sales tax on the web, we're still dodging that bullet.
adding it would seriously decrease website revenues.
Re:A Moving Target (Score:2)
This is simply the telephone companies seeing a new and competing technology arising and then doing its best to strangle that new technology. The government is, in this case, nothing more or less than the hired thug of the phone company. Watch carefully as various congresspeople who
Re:A Moving Target (Score:2)
Interstate Vs Intrastate Commerce (Score:2, Informative)
The original article starts:
This is a violation of the interstate commerce clause of the US Constitution [findarticles.com] which grants the Federal government only the power:
The clause _is_ relevant (Score:2)
Isn't it already taxed? (Score:3, Interesting)
I'm not against taxes - I'm against excessive, stupid taxes. Like paying an E911 tax, only to find out [usatoday.com] that the money collected is going towards office supplies, dry cleaning, cars, etc. Or paying over 20% tax on my cell phone service.
The Supreme Court said it best (Score:2)
The States See Another Cash-Cow Disappearing (Score:4, Insightful)
--
"It's the threat and the possibility that all of these services could migrate to the Internet," said Alexander's aide. "As services migrate to the Internet, you could bundle these services, and the telecom taxes that states currently collect they could no longer collect." -- Sen. Lamar Alexander (R-TN)
--
This is simply about the states being afraid of losing a very lucrative revenue source. The thought behind it has nothing to do with with the implementation, the technical reasons for VoIP deployment, or even whether its a Bad Idea (TM) or not. Its all about maintaining tax revenue for the state.
There are legions of accoutants, lawyers, and beauracrats in every state (hell, in every level of government) looking for things that might be taxed to generate revenue. It has nothing to do with whether the tax is smart, appropriate, or germane. Its about finding sources of revenue to support state spending.
How do you tax VoIP? And why? (Score:2)
Re:Bah (Score:4, Interesting)
Re:Bah (Score:5, Insightful)
The biggest problem with taxing VoIP is that you only need to pay for VoIP when calling someone who still has POTS. VoIP-to-VoIP calls are free.
I strongly believe the feds should ban ALL taxes on internet based telecommunications.
The only good benefit we get from the phone taxes is the emergency services connection. That WILL have to be figured out though.
Re:Bah (Score:2)
Doesn't work for mobile. (Score:2)
And when you're using your laptop on the road and call 911, they should go to your home or office? No, I don't think so.
Ditto if you're at home but happen to be VPNing in to work - and the emergency services go to your work.
And then there's Joe Random User. Requiring him to set up an address as part of his internet install (or even his internet phone install
Re:Doesn't work for mobile. (Score:2)
You can also drop the condescending attitude. You aren't holier than thou.
Re:Doesn't work for mobile. (Score:2)
Yes, it doesn't work that way. But the government will probably be trying to force it to work SOME way. And they can mandate all sorts of stuff and force the ISPs to implement it - and to pass the charge on to the consumers.
Personally I think any network-based location identifier is a bad idea - because it directly attacks anonymity. But governments would LOVE to identify who and where each Internet user of interest to
And in this case encryption doesn't help. (Score:2)
Encryption doesn't give any security, since the DEcryption routine and key has to be present in every set of 911 support software in the country. Only a matter of time until that's compromised. (Not to mention that the need to keep it secret creates a barrier against authors of open-source 911 software authors.)
Better would be a "send address" function at the user's option. But that doesn't solve the problems with mobile and VPN users I mentio
Re:Bah (Score:2, Insightful)
They still own all the cards...for now. (Score:3, Interesting)
"Apparently, the local phone companies are scared shitless because the internet is capable of destroying their stranglehold on the telecommunications market."
The phone companies might hurt for the short run, but they still seem to own the vast majority of the connections on which the internet (and thus VoIP [wikipedia.org]) ultimately operate.
People creating their own interconnected wireless internet [infoshop.org] networks will probably hurt them more in the long run. Get a large enough tower you can transmit to people like a pirat
Re:Bah (Score:2)
Unfortunately, I think we're in this tax thing because of the the way people find it shifts costs around and makes everyone pay a little bit for stuff. The goal (obviously) is to make the t
Re:Bah (Score:3, Interesting)
VoIP (as in the serve ices that are like using telephones) taxation wouldn't be that much different. I don't know much about VoIP but IIRC you need a service provider (I'm not talking about the kind of VoIP you have in games) so
Re:Bah (Score:1)
Re:Bah (Score:2)
Re:Bah (Score:2)
You can talk directly to another person. No service provider is needed.
Re:Bah (Score:3, Insightful)
Exactly... (Score:3, Insightful)
Kjella
Re:Exactly... (Score:2)
Nice try (Score:3, Informative)
You got that backwards again. (Score:2)
Last time I looked it was the Republicans that were trying to keep the taxes off the Internet (free market, create wealth, etc.) and the Democrats that were thirsting for another source of tax money.
= = = =
But of course the lefties are ALWAYS accusing their opposition of their own sins. It serves as a preemptive strike (so somebody
Re:You got that backwards again. (Score:2, Offtopic)
And Republicans don't?
Usually not, actually.
The two parties attract two different types of compensated psychopaths. The Republicans attract the rule-bound, while the Democrats attract the anything-you-can-get-away-with. ("Politics is the Art of the Possible." -LBJ) This means the Republicans get the compulsive truth-tellers and the Democrats get the pathological liars.
Not all in either party are such, of course, but
Re:Go home (Score:2)
Re:Go home (Score:2)
Re:Go home (Score:1)
Re:VOIP companies will move overseas (Score:2)
It is also important to understand that local phone service is cheap because of