Reclassification Net Neutrality Could Be a 16.1% Internet Tax – And Many Other New Web Tax Attempts

Seton Motley | Less Government |
There’s a Whole Government School
From Whence This Came

Government is an organism just like any other. Just like any other, its first priority is self-preservation. Its second is self-expansion.

Government expansion requires money. Government doesn’t earn any of its own – it must take ours. Hence – taxes. Since governments’ desire to grow is pervasively ubiquitous – the fervent desire to increase taxes is pervasively ubiquitous.

When government demands more of our coin, the assumption is that every penny they already take is being used wisely and well. As we all know, that ain’t anywhere near true.

Governments like to ratchet up taxes in areas they’ve already planted their confiscation flag. But they REALLY like to find untaxed parts of the economy – and excise the daylight out of them. In the name of “fairness”for the crushingly-taxed economic sectors.

They are the Francisco Pizaros of our wallets – the enticement and excitement of pillaging virgin territory is almost unbearable.

The Internet has for the most part been a tax (and regulation)-free zone. Thus it has become a free speech-free market Xanadu – the greatest and fastest expansion of human endeavor in history.

Government, Inc. cannot allow this to stand. For them, any private penny left in private hands is a penny wasted. (Not exactly what Ben Franklin had in mind.)

One huge new Internet tax could happen automatically. There has been in place since 1998 a bipartisan moratorium on Internet access and Internet-specific taxes – it expires December 11. What happens then?

Internet Taxes Could Reach $15 Billion a Year

A permanent ban passed the House – by bipartisan voice vote. Enter Democrat Majority Leader Harry Reid.

Harry Reid Remains Obstinately, Perversely Insistent on Taxing the Internet

Instead of putting the same bill to the Senate, however, Reid has decided to attach it to a proposed law called the Marketplace Fairness Act (MFA). That bill, which first passed the Senate last year, would require online retailers to collect tax on sales they make to out-of-state consumers.

How much will MFA cost us? At least $13 billion – just in new taxes. For now.

Imagine the dizzying new skyscraper-skyline tax heights that will be attained when uber-tax-happy places like California are no longer confined to taxing into oblivion just Californians. They’d have access to the wallets of every business – every person – in all fifty states.

And the regulatory compliance costs for every online business having to submit to and collect for 9,998 different tax jurisdictions would be absolutely crippling.

The same fifty-state-10,000-jurisdiction-tax-fest also looms huge over the digital goods you buy – where multiple states could tax you on anything you download.

These are just the overt attempts to tax the Web. Government, Inc. is also trying to throw wide open the back door to our wallets.

The Federal Communications Commission (FCC) has twice been unanimously told by the D.C. Circuit Court that their Network Neutrality forty-yard-bomb is illegal.

So FCC Chairman Wheeler is contemplating a Hail Mary – Title II Internet Reclassification. Which is a huge new regulatory monstrosity. And…surprise:

Under Title II, President Obama can also begin to tax the Internet –just as the Feds tax landlines, just as they already tax the living daylight out of your wireless (cell phone) Internet.

These new taxes would be hay-yuge.

…(O)nce ‘internet access services’ are reclassified as ‘interstate telecommunications services’ under the exclusive authority of FCC, it will be subjected to the 16.1% fee that’s currently applicable to such services.

So FCC’s ‘net neutrality’ could result into the largest single tax increase on internet to date.

And that huge tax rate goes up every quarter – automatically. Now you know why your phone bill taxes are so absurd.

Do governments need all these new omni-directional bleedings?

(Federal) Tax Day Tax Revenue Set All-Time Record

Census: State, Local Government Tax Collection Hits All-Time High

Meanwhile, governments’ spending increases inexorably. Federal, state and local governments are just this year spending $6.3 trillion. The entire U.S. economy is $17.4 trillion.

Get that? Government is spending 36.2% of what every single man, woman and child combined creates.

This is a spending problem. Governments at all levels need to stop looking for new ways to pilfer us – and instead stop being quite so profligate.

Editor’s Note: This first appeared in Red State.