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The Clock Is Ticking on ITFA

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Since 1998, the Internet Tax Freedom Act (ITFA) has been essential in promoting the expansion of e-commerce and ensuring a level playing field for Internet businesses. This will change on December 11th without decisive action from Congress.

The moratorium on Internet access taxes has been a central tool in driving innovation and the exponential growth of the Internet over the last two decades. It has spurred development in nearly every sector of the economy from Silicon Valley technology giants to new entrepreneurs to more traditional industries such as manufacturing, health care and education.

Since the ITFA was enacted, the Pew Charitable Trust estimates Internet usage among Americans has grown from below 25 percent in 1998 to over 85 percent today. For minorities, the growth in usage has occurred primarily in the last decade. These gains could be reversed if the act is allowed to expire and costs on Internet access rise.

What’s more, helping consumers, schools and small businesses continue to access the Internet is not a partisan issue. Permanently extending the moratorium on Internet access is widely supported in both the House and Senate by both parties. Everyone agrees: adding new taxes on Internet access is not the way to support American families or move the American economy forward.

This easy opportunity to solidify common ground between parties must be acted upon to ensure the continued growth of the digital economy and enhanced Internet access for consumers. We must not let the clock run out on this important piece of legislation.

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About the author

Robert D. Atkinson is the founder and president of ITIF. Atkinson’s books include Innovation Economics: The Race for Global Advantage (Yale, 2012), Supply-Side Follies: Why Conservative Economics Fails, Liberal Economics Falters, and Innovation Economics is the Answer (Rowman & Littlefield, 2006), and The Past And Future Of America’s Economy: Long Waves Of Innovation That Power Cycles Of Growth (Edward Elgar, 2005). Atkinson holds a Ph.D. in city and regional planning from the University of North Carolina, Chapel Hill, and a master’s degree in urban and regional planning from the University of Oregon.