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Tax Software A January recommendation by Congress's joint tax committee to levy a 3% federal excise tax on Internet communications found an opponent in Senator George Allen R-VA.

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Tax Help April 11, 2005 (AXcess News) Washington - A January recommendation by Congress's joint tax committee to levy a 3% federal excise tax on Internet communications found an opponent in Senator George Allen R-VA.The Internet legislation being considered by Congress would levy a tax on all Internet communications rather than phone calls made over the Internet using Voice-over-IP, or VoIP, which was part of Senator Allen's original bill.

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Help Tax Senator Allen's bill approved by lawmakers in 2004 levied an excise tax on VoIP telephone calls but prohibited state and local governments from levying their own web surcharges.

Ernst Ernst Guide Guide Tax Allen's new bill would keep dial-up and broadband services tax-free, as well as eliminate the fees charged to U.S. VoIP users, who now number 3 million and are estimated to grow to 27 million by 2009.

Tax Return Allen was quoted as saying that he will do all he can to keep lawmakers from taxing the Internet.

Return Tax The senator faced an uphill battle in 2004 against conservatives who were concerned that government would be giving up a lot of tax revenue if the Internet were not taxed. At that time, telephone services over the Internet were more of a luxury item so for Allen to have compromised its tax inclusion it was not vital. Now, VoIP is a common service that's used more widely and Allen wants it not to be taxed in his newest bill.Senators Grassley (R-IA) and Thomas (R-CA), who head the Congressional tax committee, have proposed that the federal excise tax (FET) should be reformed. The committee has recommended a permanent extension to VoIP; and an expansion to all communications activity, which would encompass Web use, paging and even cable television.

Guide Guide Master Master Tax Allen's current bill is thought by conservatives to extend the curb of state and local governments from being able to charge web surcharges to a more permanent position.

Tax Preparation Conservatives have pushed for ending the FET entirely, though opposition is in its tax revenue, which at current rates brought in $5 billion for the government last year.

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