When the FCC created new rules for Net Neutrality by reclassifying the Internet as a Title II public utility, Chairman Tom Wheeler dismissed the idea of new taxes and fees as a myth. Now that the Net Neutrality Order has been made public, it is becoming clear that Chairman Wheeler is being less than honest. The real myth is that Big Government can regulate one of the greatest innovations mankind has ever known without adding to its cost. The reality is that new taxes and fees are coming.
While the order does not in and of itself create new taxes or fees, it lays a groundwork for others to do so, without ever calling it an Internet tax. Specifically, states and local municipalities can now increase taxes on property owned by Internet Service Providers because public utilities are allowed to be taxed at a much higher rate than other businesses. Wheeler and others who sold Americans on the Net Neutrality scheme point to the Internet Tax Freedom Act (ITFA) and say that it prevents “state and local jurisdictions from imposing new taxes on the Internet,” but since the Internet is now considered a public utility, it would be the providers — not the Internet itself — that would be taxed. Of course the ISPs will have to consider those taxes as business costs and pass them along to consumers. The result is going to be higher and higher Internet bills — the very thing Wheeler and his ilk say will not happen.
To make matters worse, the ITFA comes up for reauthorization in September, and though it has been reauthorized five times, there is no guarantee that will happen again. If reathorization fails, states and local municipalities could add to their coffers by taxing the Internet directly as well as by taxing the property of ISPs at the higher rate allowed by the Title II reclassification. Furthermore, there is a difference between the theory of the order not creating new taxes and the reality of the federal government passing regulations and then expanding them to something larger.
FK – Imagine that. What’s next, subsidizing net access for the poor? Betcha ‘right wing extremists’ and other undesirables won’t qualify.
Pair this with the ongoing effort to mainstream the net and sweep all non PC content into some dark corner that most of the sheeple will never see.