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Bipartisan legislation establishing a national framework for digital goods and services taxation introduced in House and Senate

Download Fairness Coalition applauds sponsors of the bill for their efforts.

(May 12, 2011) –  The Download Fairness Coalition today applauds Members of the House and Senate for introducing bipartisan legislation to establish a national framework for how digital goods and digital services should be taxed for state & local transaction tax purposes to preclude multiple and discriminatory taxes from being imposed on such goods and services.

The Digital Goods and Services Tax Fairness Act was introduced today by Senator Ron Wyden (D, OR) and Senator John Thune (R, SD) and in the House by Chairman Lamar Smith (R, TX) and Congressman Steve Cohen (D, TN).

“We are pleased that this bipartisan group of Members has recognized the need to protect consumers from duplicative taxes,” said Sam Whitehorn, Executive Director of the Download Fairness Coalition.  “Because of the leadership of Senators Wyden and Thune and Congressmen Smith and Cohen, consumers will have tax certainty when purchasing digital goods, state and local jurisdictions seeking to tax such commerce will have a solid framework and the providers required to collect such taxes will have consistent guidelines, providing a win/win for all stakeholders.”

The Digital Goods and Services Tax Fairness Act will address this problem by:

  • Clearly identifying which jurisdiction has the right to tax digital transactions.
  • Precluding discriminatory taxes currently imposed on communications services (telecom utility taxes) from being imposed on digital goods and services solely because they are transacted over communications networks.
  • Providing that taxes imposed on tangible personal property, telecommunication service, Internet access services or audio or video programming service cannot be retroactively “construed” to have also been imposed on digital goods and digital services through administrative ruling, regulation or similar pronouncement.  States should have to enact laws clearly specifying their intent to tax digital goods and services.

“We look forward to working with the Sponsors of this legislation to ensure that it is enacted in the 112th Congress,” said Sam Whitehorn.  “Working with industry, consumer groups, taxpayer advocacy groups, and local Chambers of Commerce, amongst others, we look forward to supporting Senators Wyden and Thune and Congressmen Smith and Cohen.”

Download Fairness Coalition   
The Download Fairness Coalition is an organization that educates policymakers about the benefits of the digital economy. The organization is committed to policies that increase access to digital goods and services for all consumers. As an organization formed within the meaning of section 501(c)(4), contributions to the organization are not tax deductible as a charitable contribution for federal income tax purposes.