[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 995 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 995

  To amend the Internal Revenue Code of 1986 to clarify that fees for 
 Internet and other online services are not, and shall not be, subject 
                    to tax, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 6, 1997

Mr. Weldon of Florida introduced the following bill; which was referred 
                   to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to clarify that fees for 
 Internet and other online services are not, and shall not be, subject 
                    to tax, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Tax-Free Internet Act of 1997''.

SEC. 2. CLARIFICATION THAT FEES FOR INTERNET AND OTHER ONLINE SERVICES 
              ARE NOT, AND SHALL NOT BE, SUBJECT TO TAX.

    (a) In General.--Section 4253 of the Internal Revenue Code of 1986 
(relating to exemptions from tax on communications services) is amended 
by redesignating subsection (k) as subsection (l) and by inserting 
after subsection (j) the following new subsection:
    ``(k) Clarification of Exemption for Fees for Internet and Other 
Online Services.--
            ``(1) In general.--Nothing in this subchapter shall be 
        construed to subject to tax under this subchapter amounts paid 
        for any Internet access service, Internet access-related 
        service, or online service, and such amounts shall never be 
        subject to any excise tax under this title without specific 
        reference to this subsection. The preceding sentence shall not 
        apply to communications services (as defined in section 4251(b) 
        as in effect on the date of the enactment of this subsection).
            ``(2) Definitions.--For purposes of paragraph (1)--
                    ``(A) Internet access service.--The term `Internet 
                access service' means any service that enables a 
                customer to connect a computer to the Internet.
                    ``(B) Internet access-related service.--The term 
                `Internet access-related service' means any service 
                such as electronic mail, chat, or bulletin boards or a 
                browser, usually offered by an Internet access service 
                provider or an online service provider.
                    ``(C) Online service.--The term `online service' 
                means any service, offered over a telecommunications 
                network, which provides the user with access to 
                information and services on a proprietary subscriber 
                network.''
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the date of the enactment of this Act.

SEC. 3. RESTRICTION ON USE OF APPROPRIATED FUNDS.

    None of the funds appropriated by any Act may be used by any 
Federal officer or employee to develop any proposal for imposing any 
excise tax on amounts paid for any service to which section 4253(k) of 
the Internal Revenue Code of 1986 applies (as added by this Act).
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