Lawmakers Forecast Outlook for IT Bills

WASHINGTON (05/03/2000) - Of all the high-tech bills now being considered in Congress, digital-signature legislation may have the best chance of passing this year. But some technology-savvy lawmakers also aren't ruling out action on privacy legislation, H-1B visas and Internet taxation.

The forecasts of the legislative outlook for those and other key information technology issues were presented by a number of Congressional lawmakers here yesterday at the Information Technology Association of America's (ITAA) annual summit on high-tech legislation.

On the subject of Internet taxation, Sen. Ron Wyden, a Democrat from Oregon, co-sponsor of the Internet Tax Freedom Act, said he hopes to break the "gridlock" over an extension of the tax moratorium by making a compromise proposal to state and local government leaders.

The three-year moratorium, which is due to expire in October next year, bans new or discriminatory taxes on e-commerce. Wyden said his compromise would include a promise to ensure that Congress considers any tax proposals being developed by state governments.

There are 26 states working on a plan that would streamline and simplify the sales tax system and also shift the burden and cost of calculating and collecting the taxes to third-party service providers. Participation would be voluntary, though. Businesses are now exempt from collecting sales taxes except in states where they have a "physical presence."

Wyden said he's concerned that if Congress doesn't act this year to extend the moratorium, it "will start to see chaos" in various states on the Internet taxation issue.

Meanwhile, Rep. Tom Davis, a Republican from Virginia, said he expects the H-1B visa cap on foreign workers to be increased by Congress. But he also warned that whatever measure passes "may not be the perfect bill that everyone wants."

Davis said he's working with Rep. Lamar Smith, a Republican from Texas, chairman of the House Judiciary Committee's immigration subcommittee, to refine a proposal that would lift the cap, which is currently set at 115,000 visas.

High-tech industry groups have said the Smith bill sets restrictions that may continue to make life difficult for employers. The ITAA, a Washington-based trade association that represents high-tech vendors, is supporting legislation that would increase the visa cap to 200,000 over the next several years.

"We know you need a bill. We're not going let you down," Davis said at the ITAA forum.

On the other hand, Davis said legislation that would protect databases from businesses that copy and then resell the contents as their own may not make progress during the current session of Congress.

Various proposals on the database protection issue have divided the industry, "and I just don't see this Congress acting in ways that split the industry in an election year," Davis said.

Another pressing matter before Congress is legislation that would give digital signatures the same legal weight as written ones. At the moment, a conference committee is working to reconcile the differences between bills approved by the House and the Senate.

"Soon, the day will be here when an electronic signature will have the same validity as a written signature. This is fundamental to the growth of the new economy," said House Commerce Committee Chairman Thomas Bliley, a Republican from Virginia.

But the legislation still faces hurdles over the contentious issue of whether some communications from companies to their customers should still have to be made in writing. Consumers, for instance, may not want to be electronically notified of important actions such as a foreclosure. Negotiations are continuing.

"We're pretty hopeful that by the end of the session, there will be a bill that everyone can support," said Andrew Pincus, general counsel at the U.S.

Department of Commerce.

Despite the traditional reluctance on the part of Congress to make major decisions in an election year, some of the lawmakers at yesterday's forum said they aren't ruling out action on privacy.

If the states continue to act aggressively in pushing for privacy legislation, Wyden said, business groups may ask Congress to set a single federal privacy standard.

The privacy issue is an especially volatile one, he added. "If somebody stands up in the fall of 2000 with a big privacy bill and makes a good case, they may end up getting 98 votes (in the Senate) on the thing," Wyden said.

Finally, Sen. Charles Robb, a Democrat from Virginia, said he expects legislation to normalize trade relations with China to pass in the Senate by a "very substantial margin." But the vote in the House of Representatives is expected to be closer.

The legislation would require China to open up its markets to U.S. companies and lower the tariffs they have to pay. "We don't give up anything, really, in this one," Robb said.

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