Online retailers are facing an "enormous threat" if Washington's lame-duck Congress passes a new Internet sales tax before they leave office at the end of the year, Texas Republican Sen. Ted Cruz is warning.
"Small online retailers will have to comply with over 9,600 tax jurisdictions across the country" if the tax is passed, the firebrand senator warns in a video released Friday morning on YouTube. "Big box stores don't have to do that and it's just not fair."
"It would be a crying shame if the first thing Republicans do after winning a historic election is return to Washington and pass an unprecedented, massive new tax requirement — up to $340 billion over 10 years — on Internet sales nationwide," said Cruz. "Instead, the new Republican Congress, when it is sworn in, should demonstrate its commitment to a free, thriving Internet by making permanent the ban, originally signed into law by President Bill Clinton, on imposing any additional taxes on Internet access."
Corporate lobbyists want an Internet tax bill passed to crush the competition smaller businesses pose, Cruz said, and "they see a chance to make it law during the lame duck session of Congress."
Cruz points out in the video that "ten senators who voted for the Internet sales tax last year have now been defeated or are retiring, [and] this may be their last chance to pass it. We must say no. No net tax. Not now, not ever."
The senator planned to reiterate his opposition during a speech at 3:30 p.m. Eastern Standard Time in Austin, Texas. The Texas Tribune planned to stream Cruz' comments live at
Texastribune.org/livestream.
In a Thursday opinion piece in
The Washington Post, Cruz called the Internet "the great equalizer" for jobs and opportunity and a commitment should be made to keep it that way, not only by rejecting the tax plan, but threats to net neutrality.
"Washington politicians want the money, and they want more and more control over our speech," said Cruz.
He called for lawmakers to abandon further taxing both Internet access and sales, as forcing online retailers to keep track of all the nation's tax jurisdictions, keeping records, and collecting taxes, or risking fines for noncompliance "is simply not fair."
Cruz also called on Washington to dismiss plans that give nations that are hostile to human rights and democracy more Internet policy influence.
The Obama administration ended its contract this year with ICANN, a California nonprofit that manages basic Internet functions, including the creation of Web addresses and domain names.
"Once this contract expires, ICANN will be governed by a global, multi-stakeholder community that could grant nations such as Iran, Russia and China more authority over the rules and regulations that govern the Internet," explained Cruz, saying "the likes of Russian President Vladimir Putin, Iran’s Ayatollah Ali Khamenei and Chinese President Xi Jinping should not dictate what can be read, written, distributed, bought and sold on the Internet."
In addition, Cruz called for more growth in technology, which he said won't happen if the Internet is not kept free from regulations such as those that hinder healthcare, energy and banking.
On Monday, President Barack Obama said he
backed net neutrality and suggested that the Federal Communications Commission closely regulate the Internet, treating it as a public utility similar to telephone service.
Net neutrality, said Cruz in The Post piece, "is Obamacare for the Internet. It would put the government in charge of determining Internet pricing, terms of service and what types of products and services can be delivered, leading to fewer choices, fewer opportunities and higher prices."
But utilities regulated by the government "invariably destroy innovation and freedom," he said. "Which is more innovative, the U.S. Postal Service or Facebook and Twitter?"
Constitutional rights must also be recognized as digital rights, said Cruz.
"We must remain vigilant," he said. "Intellectual property must be defended, but any threat to quell speech on the Internet must be treated seriously and subsequently defeated."
Watch the video here
Sandy Fitzgerald ✉
Sandy Fitzgerald has more than three decades in journalism and serves as a general assignment writer for Newsmax covering news, media, and politics.
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