Gephardt Supports Extending Net Tax Moratorium

WASHINGTON (03/28/2000) - U.S. House Democratic Leader Richard Gephardt said he supports an extension of the moratorium on new sales taxes on the Internet, but only through 2003 to allow time to work out a broader solution to the issue.

In a speech here today touching on most of the key technology issues currently before Congress, Gephardt criticized other proposals that extended the moratorium for longer periods of time, or even indefinitely. "A permanent moratorium may turn out to be self-defeating for the tech industry," Gephardt said. Even an additional five years "is an eternity in Internet time," he said.

Gephardt conceded that the inconclusive outcome of the recent meeting of the Advisory Commission on Electronic Commerce [see "Consensus Eludes Internet Tax Meeting," March 21] showed that there's no clear sign of a consensus on Internet taxation. But sweeping changes to the tax system are needed because brick-and-mortar businesses are disadvantaged by Internet sales, he said.

"I strongly feel that the government should never allow this kind of inequity in our tax system to continue indefinitely," Gephardt said. "But it is equally unfair and unwise to require e-business to run the maze of more than 7,000 state and local taxes."

The Democratic leader also said that he supports raising the ceiling on H-1B visas, specifically citing a bill recently introduced that raises the cap to 200,000 but also provides additional funding for education with the goal of producing more American workers qualified for high technology jobs.

"Raising the existing ceiling on H-1B visas is a quick fix that does nothing to address our future dependency on imported talent. It must become our national crusade to produce an American workforce with 21st century skills," Gephardt said.

Gephardt spoke this morning before the Information Technology Association of America (ITAA).

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