[Congressional Record Volume 146, Number 47 (Thursday, April 13, 2000)]
[Extensions of Remarks]
[Page E577]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             DIGITAL DIVIDE ACCESS TO TECHNOLOGY ACT (DATA)

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                           HON. JERRY WELLER

                              of illinois

                    in the house of representatives

                        Thursday, April 13, 2000

  Mr. WELLER. Mr. Speaker, I am pleased to join with my colleague, John 
Lewis of Georgia, to introduce H.R. 4274, the Digital Divide Access to 
Technology Act of 2000 (DATA Act). The DATA Act addresses a rather new 
situation which involves employers providing home computers to their 
employees.
  Over the past couple of months, four major companies--Ford Motor 
Company, American Airlines, Delta Airlines, and Intel--have announced 
programs to provide home computers to their employees. The question 
before us is whether employer-provided home computers should be 
considered taxable income to the employees.
  I believe that the government should not tax these computers and the 
legislation we are introducing today will ensure that these basic 
computers do not become a tax liability for the employees.
  The DATA Act is a digital divide issue and it represents a powerful 
partnership between private companies and the government as we work to 
reduce the so-called digital divide and create new digital 
opportunities. These home computers will be available to employees and 
their families for work and personal use. Once in the home, the 
computers can be used by employees for Internet training, by the 
children for homework and research, and other family members to balance 
the family budget and stay in touch with far-away relatives. There are 
no restrictions on the use of the computers.
  For tax purposes, the DATA Act treats the Internet access and first 
$1,260 of the value of a computer and peripheral equipment (e.g., 
monitors, printers and keyboards), including software, and Internet 
access as a fringe benefit, not subject to income tax. For the program 
to qualify, employers have to provide computers to substantially all 
employees working in the United States and employees can receive only 
one computer within a 36 month time period.
  If the employer offers a program allowing employees to purchase an 
upgraded ``or deluxe'' model computer, the first $1,260 in value is 
still non-taxable, employees can pay for the deluxe version if they 
choose. Additionally, if employees are required to pay a monthly co-
payment for the computer, such as the $5 monthly responsibility of Ford 
employees, this payment does not factor into the value of the computer. 
Let me give you an example of how this works.
  The 350,000 employees at Ford Motor Company will soon receive a home 
computer which costs $24.95 per month over 36 months, for a total of 
$898. The employees pay $5 per month, or $180 over 3 years, for the 
computer. Ford pays $19.95 per month for each employee, or almost $720 
over 3 years. The $720 paid by Ford for the computers falls far below 
the $1,260 exclusion provided by this legislation. This program is 
available to all employees working for Ford. This includes everyone 
from the janitor, to the union worker, to the managers, and the Vice 
Presidents.
  Mr. Speaker, these companies are likely to be only the first of many 
companies to provide home computers to their employees. I strongly 
believe this is an important way we, as policymakers, can work with 
corporations to help put more computers into the hands of American 
families and children. This legislation will help us close the digital 
divide and provide digital opportunities to hundreds of thousands of 
families currently without this equipment which is rapidly becoming a 
necessity for survival in the 21st century economy.
  I look forward to working with these and other employers to continue 
developing this legislation to make it easier for these computers to be 
taken home by employees. I also look forward to working with the House 
Leadership, Chairman Archer, my colleagues on both sides of the aisle, 
as well as the Administration to ensure that this powerful mechanism 
available to close the digital divide is fully utilized.

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