[Congressional Record (Bound Edition), Volume 145 (1999), Part 19]
[House]
[Pages 26814-26820]
[From the U.S. Government Publishing Office, www.gpo.gov]



URGING UNITED STATES TO SEEK GLOBAL CONSENSUS SUPPORTING MORATORIUM ON 
     TARIFFS AND SPECIAL, MULTIPLE, AND DISCRIMINATORY TAXATION OF 
                          ELECTRONIC COMMERCE

  Mr. CRANE. Mr. Speaker, I move to suspend the rules and agree to the 
concurrent resolution (H. Con. Res. 190) urging the United States to 
seek a global consensus supporting a moratorium on tariffs and on 
special, multiple, and discriminatory taxation of electronic commerce, 
as amended.
  The Clerk read as follows:

                            H. Con. Res. 190

       Whereas electronic commerce is not bound by geography and 
     its borders are not easily discernible;
       Whereas transmissions over the Internet are made through 
     packet-switching, making it impossible to determine with any 
     degree of certainty the precise geographic route or endpoints 
     of specific Internet transmissions and infeasible to separate 
     domestic from foreign Internet transmissions;
       Whereas inconsistent and inadministrable taxes imposed on 
     Internet activity by subnational and national governments 
     threaten not only to subject consumers, businesses, and other 
     users engaged in interstate and foreign commerce to multiple, 
     confusing, and burdensome taxation, but also to restrict the 
     growth and continued technological maturation of the Internet 
     itself;
       Whereas the complexity of the issue of domestic taxation of 
     electronic commerce is compounded when considered at the 
     global level with almost 200 separate national governments;
       Whereas the First Annual Report of the United States 
     Government Working Group on Electronic Commerce found that 
     fewer than 10,000,000 people worldwide were using the 
     Internet in 1995, that more than 140,000,000 people worldwide 
     were using the Internet in 1998, and that more than 
     1,000,000,000 people worldwide will be using the Internet in 
     the first decade of the next century;
       Whereas information technology industries have accounted 
     for more than one-third of real growth in the United States' 
     Gross Domestic Product over the past three years;

[[Page 26815]]

       Whereas information technology industries employ more than 
     7,000,000 people in the United States, and by 2006 more than 
     half of the United States workforce is expected to be 
     employed in industries that are either major producers or 
     intensive users of information technology products and 
     services;
       Whereas electronic commerce among businesses worldwide is 
     expected to grow from $43,000,000,000 in 1998 to more than 
     $1,300,000,000,000 by 2003, and electronic retail sales to 
     consumers worldwide are expected to grow from $8,000,000,000 
     in 1998 to more than $108,000,000,000 by 2003;
       Whereas the Internet Tax Freedom Act of 1998 enacted a 
     policy against special, multiple, and discriminatory taxation 
     of the Internet and electronic commerce, and stated that 
     United States policy should be to seek bilateral, regional, 
     and multilateral agreements to remove barriers to global 
     electronic commerce;
       Whereas the World Trade Organization, at its May 1998 
     ministerial conference, adopted a declaration that all 132 
     member countries ``will continue their current practice of 
     not imposing customs duties on electronic transmissions;''
       Whereas the Organization for Economic Cooperation and 
     Development and industry groups issued a joint declaration at 
     an October 1998 ministerial meeting on global electronic 
     commerce opposing special, multiple, and discriminatory 
     taxation of the electronic commerce and the Internet;
       Whereas the Committee on Fiscal Affairs of the Organization 
     for Economic Cooperation and Development has stated that 
     neutrality, efficiency, certainty, simplicity, effectiveness, 
     fairness, and flexibility are the broad principles that 
     should govern the taxation of electronic commerce;
       Whereas the United States has issued joint statements on 
     electronic commerce with Australia, the European Union, 
     France, Ireland, Japan, and the Republic of Korea opposing 
     special, multiple, and discriminatory taxation of electronic 
     commerce; and
       Whereas a July 1999 United Nations Report on Human 
     Development urged world governments to impose ``bit taxes'' 
     on electronic transmissions, raising concerns that U.S. 
     policy against special, multiple, and discriminatory taxation 
     of the Internet may be undermined: Now, therefore, be it
       Resolved by the House of Representatives (the Senate 
     concurring), That the Congress--
       (1) urges the President to seek a global consensus 
     supporting--
       (A) a permanent international ban on tariffs on electronic 
     commerce; and
       (B) an international ban on bit, multiple, and 
     discriminatory taxation of electronic commerce and the 
     Internet;
       (2) urges the President to instruct the United States 
     delegation to the November 1999 World Trade Organization 
     ministerial meeting in Seattle, Washington to seek to make 
     permanent and binding the moratorium on tariffs on electronic 
     transmissions adopted by the World Trade Organization in May 
     1998;
       (3) urges the President to seek adoption by the 
     Organization for Economic Cooperation and Development, and 
     implementation by the group's 29 member countries, of an 
     international ban on bit, multiple, and discriminatory 
     taxation of electronic commerce and the Internet; and
       (4) urges the President to oppose any proposal by any 
     country, the United Nations, or any other multilateral 
     organization to establish a ``bit tax'' on electronic 
     transmissions.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Illinois (Mr. Crane) and the gentleman from New York (Mr. Rangel) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Illinois (Mr. Crane).


                             General Leave

  Mr. CRANE. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on House Concurrent Resolution 190.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Illinois?
  There was no objection.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, today I join my colleagues in their support of House 
Concurrent Resolution 190. This resolution urges the President to seek 
a global consensus in support of a permanent international ban on 
tariffs on electronic commerce and an international ban on certain e-
commerce taxes.
  The Internet and electronic commerce are vital to continued global 
economic growth and prosperity. Information technology is driving the 
U.S. economic growth, increasing profit, creating higher-paying jobs, 
and expanding opportunities for all Americans.
  As we prepare for the upcoming round of global trade negotiations to 
be launched next month in Seattle, we face an era of rapid change in 
global commerce. Increasingly, electronic commerce has supplanted the 
old transAtlantic cable and telephone lines, and now serves as the 
preferred method of communication, which in turn facilitates trade.
  The number of people in the world using the Internet has grown from 3 
million in 1995 to 200 million users today, and may reach 1 billion by 
2005.
  In the United States, electronic commerce totalled in excess of $50 
billion in 1998, and is projected to reach $1.4 trillion by 2003. By 
2006, almost half of our work force either will be employed by 
information technology services and products businesses, or will be 
intensive users of these businesses. We should refrain from taking 
measures that could inhibit the growth of e-commerce and access to 
information technology.
  These lines of communication should remain barrier-free, not subject 
to tariffs or taxes or burdensome regulations. We must seek consensus 
with our trading partners on this issue.
  I understand that some countries who are in earlier stages of 
economic development have concerns about establishing a permanent 
moratorium on such tariffs and taxation. I hope that the United States 
will continue to advocate a permanent ban, instead of a mere extension 
of the current temporary one. Our response should be to convince these 
countries that information technology has important applications for 
speeding growth in developing regions, as Internet access reduces the 
obstructions entrepreneurs, artisans and small businesses face in 
finding customers and managing paper flow.
  Electronic commerce puts developing countries on an equal footing 
with developed countries, and it leapfrogs many of the infrastructure 
barriers that these countries face in traditional commerce.
  I further note that it does not help to build this consensus when the 
United States seeks to put controversial non-trade issues on the 
Seattle agenda about which devoping countries are justifiably wary. 
Raising such issues means that the trade aspects of our agenda become 
more problematic to achieve.
  We must seek to develop a lasting consensus among developed and 
devoping countries alike for the promotion of global trade. The 
administration must find common ground and forge ahead to increase 
global trading opportunities, which in turn pave the way to greater 
prosperity for all.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of the concurrent resolution before us 
today. The ability to engage in commerce over the Internet has 
revolutionized the way we and the world conduct business. It has 
integrated and opened markets and spread consumer products, 
technological and medical advances to the farthest reaches of the 
Earth.
  Books and magazines are now a touch away for many of us, no matter 
where we live. Clearly, it has transformed our economy, and is in the 
process of transforming the economies of the rest of the world. We need 
to continue this process and this progress and ensure that e-commerce 
is allowed to grow and develop.
  Currently, WTO members have agreed to a moratorium on the imposition 
of duties on electronic transmissions. That moratorium may be made 
permanent, as this resolution urges.
  I would also urge my colleagues in voting for this resolution to 
consider how we can ensure that more Americans, including our 
schoolchildren, are positioned to capitalize on the benefits of this 
new technology-driven global economy.
  According to this resolution, more than 1 billion people will be 
using the Internet in the next decade. That 1 billion needs to include 
the entire United States working and school-age population. In fact, 
that is an issue I think that we should have addressed in this 
legislation, had this legislation been brought to the floor in the 
normal House procedure.

[[Page 26816]]

  In any event, Mr. Speaker, I support the legislation before us today. 
I do hope that the House leadership would find some way of bringing 
issues that are in the jurisdiction of the Committee on Ways and Means 
to the committees of jurisdiction so that we can have hearings, we can 
invite those people that have the responsibility, and handle these in 
the way that we should.
  I am afraid that the suspension calendar more and more is being used 
as a press organ of the majority, rather than the committees that have 
been structured for this purpose.
  Mr. Speaker, I yield the balance of my time to the gentleman from 
Michigan (Mr. Levin), the ranking Democrat on the Subcommittee on 
Telecommunications, Trade, and Consumer Protection, and I ask unanimous 
consent that he be allowed to allocate the remainder of the time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Levin) will 
control the remainder of the time.
  Mr. CRANE. Mr. Speaker, I yield such time as he may consume to our 
distinguished friend and colleague, the gentleman from California (Mr. 
Cox), the author of this very important piece of legislation, House 
Concurrent Resolution 190.
  Mr. COX. Mr. Speaker I thank the gentleman for yielding time to me. I 
also thank the chairman of the Committee on Ways and Means, the 
gentleman from Texas, for permitting this resolution to come to the 
floor under expedited circumstances. It is, of course, because of the 
impending meeting of the World Trade Organization in Seattle on 
November 30 of this year that we wish Congress to be on record now, in 
advance, on this very important topic.

                              {time}  1045

  I would also like to recognize the important contribution to this 
legislation by a gentleman from the other body, our former colleague, 
the Senior Senator from the State of Oregon, Mr. Wyden, who has in fact 
introduced a resolution identical to this in the other body, Senate 
Concurrent Resolution 58.
  It was just 1 year ago, October of 1998, that he and I worked on the 
Cox-Wyden Internet Tax Freedom Act, which is now the law of the land.
  The initiative we are considering in the House today, House 
Concurrent Resolution 190, takes the principle of the Internet Tax 
Freedom Act; that is, that information should not be taxed and we 
should keep special exactions that discriminate against electronic 
commerce off of the Internet, and applies to it to the international 
arena.
  This resolution before us has three main elements. First, no tariffs 
on the Internet. Our legislation calls on the World Trade Organization, 
which will be meeting, as I said, in late November, 1999 in Seattle, to 
enact a permanent moratorium on E-commerce tariffs. This will preserve 
the taxation status quo. It will not take bread off the plate of any 
nation. Because, at present, none of the WTOs, more than 130 member 
nations, currently has such a tariff. This is the time to act before 
bad things happen.
  The second important piece of this resolution is that it establishes 
the principle of no multiple or discriminatory foreign taxes on 
electronic commerce. Our legislation calls on the OECD, the 
Organization for Economic Cooperation and Development and its 29 member 
countries to subscribe to the principle of no multiple discriminatory 
or special Internet taxes.
  Third, our legislation condemns the bit tax proposal of the United 
Nations and calls for a permanent ban on such Internet specific taxes. 
A bit tax, for those who have not been following this closely, is 
literally a tax on every bit of information, all the digital 0s and 1s. 
The more 0s and 1s, the greater the file size, the greater the tax. It 
is an obviously discriminatory levy aimed at electronic commerce.
  Let me explain why this legislation is so important. Centuries ago, 
when the Moors still ruled Spain, there was a small seaport about 20 
miles from Gibraltar. The Mediterranean seas off of this port were 
ruled by a ruthless band of pirates. Their success in raiding trading 
ships was such that merchants who traveled the area began to think of 
paying tribute to these pirates as just a cost of doing business. So 
the merchants began to refer to these payments by the name of a nearby 
seaport, Tarifa. It is from that that we get the name tariff in today's 
vocabulary.
  In the years since then, the practice of imposing tariffs has, of 
course, become far more commonplace and has been taken over by 
governments. But a tariff, nonetheless, retains an element of piracy, 
the unwelcome exaction of unnecessary fees.
  Today, the Internet is the vehicle for over $50 billion annually in 
trade and goods and services. This trade today is conducted free of 
piracy. The purpose of this resolution is to keep it that way. It is 
especially important to preserve this no taxes policy since the 
Internet's commercial potential is greater than that of any previously 
existing medium of trade.
  A global free trade zone on the Internet will have immediate 
advantages for Americans, for workers who manufacture and for workers 
who provide services and for consumers, because U.S. firms excel in the 
information and media services that flourish on the Internet.
  Last year, U.S. exports associated with licensing fees and royalties 
earned $37 billion. U.S. imports in this category were $11 billion. 
That is the biggest trade surplus we enjoy in any category of our 
trade.
  Americans use the Internet more than citizens of other countries. We 
in our Nation account for roughly half of the world's usage of the 
Internet; that is, as of September of this year.
  But making the Internet a tariff-free zone will also help our trading 
partners. As we all know, free trade benefits both buyer and seller. 
Keeping tariffs off the net, moreover, will accelerate its development 
in foreign countries and permit the citizens of foreign nations to 
share in the Internet's benefits and the access to global markets that 
it provides.
  As I said, there is an urgency to the passage of this legislation. 
This year, the ministerial meeting of the WTO will occur on November 
30. At least year's meeting in May 1998, the United States successfully 
negotiated and achieved a 1-year standstill of the application of 
tariffs to E-commerce. This was a disappointment to those of us who 
were urging a permanent ban.
  We now have the opportunity to take that 1-year moratorium and extend 
it and make it permanent; and that is the purpose of Congress going on 
record today to urge the administration to take this action, and, 
moreover, to let the ministers of all of the member nations of the 
World Trade Organization understand that this is the policy, not just 
of the Executive Branch, but of the United States Congress as well.
  This resolution calls on the President to work with all nations to 
enact a permanent moratorium on electronic commerce tariffs at that 
upcoming WTO ministerial meeting.
  Lastly, on this subject of bit taxes, tax collectors around the globe 
are still talking openly about this special new Internet tax called a 
bit tax. This is the most discriminatory kind of tax that could be 
levied against the Internet. It will establish for us in this area what 
we already know to be true generally that the power to tax is the power 
to destroy. Outlawing bit taxes worldwide, as we have already done in 
the Internet Tax Freedom Act for our Nation, is vitally important.
  I wish once again to thank my colleagues for attaching the same 
urgency to this as do I, and my colleague in the Senate, Mr. Wyden, for 
acting on this in such an expedited fashion.
  Mr. LEVIN. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of this resolution. One of the most 
important, prominent features of the globalizing economy at the dawn of 
this new century is the rapid rise of the Internet as a mode of 
commerce.
  The Internet is not only a meeting place for buyers and sellers, it 
is an important channel of distribution. Thus, for instance, computer 
software can be

[[Page 26817]]

sent from a supplier to a customer at the speed of light. Providers of 
services such as information technology can assist customers thousands 
of miles away.
  So far, the Internet has remained free of tariffs and nontariff 
barriers to trade. Those latter nontariff barriers are important issues 
to consider in this instance, and in others. Some may be tempted to 
attach new trade-impeding regulations to this new technology. We should 
resist that temptation at this relatively early stage in the 
development of the Internet as a mode of commerce.
  This resolution urges the administration to seek a global consensus 
on making the existing moratorium on special E-commerce tariffs and 
taxes permanent. I support that endeavor.
  While I vote for this resolution, I want to join the gentleman from 
New York (Mr. Rangel) in expressing disappointment in the manner by 
which it is being brought before this body. This House has a 
constitutional responsibility in the regulation of U.S. trade with 
foreign nations. That means providing comprehensive guidance to the 
administration as it embarks on a new round of world trade 
negotiations.
  Fulfilling our constitutional responsibility requires more than 
considering a single negotiating objective as we are doing today. 
Rather, we should be considering a broader range of negotiating 
objectives. There is, for example, a resolution, I believe with over 
200 signatures, relating to the vital importance of maintaining U.S. 
anti-dumping laws. Also, there is the important issue of the role of 
core labor standards in trade negotiations.
  Here I want to express, because it has been mentioned by the chairman 
of the subcommittee, the need for us to face this issue of core labor 
standards in trade negotiations. I think they are vitally relevant to 
them.
  At the end of the Seattle Round of world trade negotiations, this 
House will most likely be called upon to enact implementing 
legislation. We must not wait until the last minute to provide our 
input. Instead, we should be working with the administration now to 
develop and refine our agenda going into the new round. We must not 
defer this responsibility.
  So I urge my colleagues, remembering, though, the need for a broader 
ring of consideration, to vote for H. Con. Res. 190. I urge all of us 
to participate in developing a set of objectives for the new round of 
world trade negotiations that covers the gamut of issues confronting 
American workers, farmers, and businesses in the global economy.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CRANE. Mr. Speaker, I yield 1\1/2\ minutes to the distinguished 
gentleman from Oregon (Mr. Walden).
  Mr. WALDEN of Oregon. Mr. Speaker, as my colleagues know, the 
Internet has brought countless improvements to the lives of many 
Americans in the past several years. One of the most promising uses of 
the Internet is its ability to connect countless people and businesses 
at little cost through E-commerce.
  Doing business over the Internet allows people all over the world to 
search for the best deal on a wide range of goods and services, 
destroying the traditional barriers to free and open competition and 
comparison shopping. It empowers consumers, especially in rural and 
remote small communities, to easily reach the marketplaces of the 
world. These factors have contributed to making E-commerce increasingly 
popular. It is expected to account for $1.3 trillion in sales by 2003.
  So far E-commerce has been allowed to flourish largely without the 
interference of unfair government regulation. Unfortunately, it is the 
way of governments the world over to tax and impede the growth of such 
a new source of prosperity.
  Mr. Speaker, I want to strongly support the House Concurrent 
Resolution 190, which would urge the President to work to prevent 
discriminatory and harmful taxes on E-commerce in the United States and 
abroad. This resolution would show the world that the U.S. House of 
Representatives supports the continued growth of E-commerce free from 
destructive taxation.
  Mr. Speaker, let us make another point very clearly. Let us never 
allow a tax or tariff on e-mail.
  Mr. Speaker, I would like to thank the gentleman from California (Mr. 
Cox), the Committee on Ways and Means, and my colleague from the 
Senate, Senator Wyden, for helping bring this important measure to our 
attention and for their bringing this to the floor.
  Mr. LEVIN. Mr. Speaker, it is now my privilege to yield 1\1/2\ 
minutes to the gentlewoman from California (Ms. Lofgren), who is highly 
versed in these matters.
  Ms. LOFGREN. Mr. Speaker, I support this concurrent resolution. As my 
colleagues all may know, not one of the 130 members of the World Trade 
Organization presently imposes a tariff on the Internet. That is a good 
thing and may account for the Internet's success. I would like this 
``no tariff'' policy to become the official policy of the WTO. I know 
there are some nations thinking of applying various taxes. I encourage 
the Members of this Congress to go on record against such taxes.
  Electronic commerce is made possible by the bits and bytes of 
information that travel in packets within this country and around the 
world, across State and national boundaries. There are some who want to 
tax each bit of information that is transmitted.
  Earlier this year, the UN suggested taxing the bits that make up the 
E-mails we have grown accustomed to sending each other. This may 
suggest to my colleagues the mischief that could be caused by doing 
such a thing.
  Let us nip this bit tax idea in the bud and support this concurrent 
resolution that urges a worldwide ban on any bit tax.
  Mr. Speaker, I urge all of my colleagues to support the concurrent 
resolution.
  Mr. LEVIN. Mr. Speaker, I yield 3 minutes to the gentleman from Texas 
(Mr. Doggett), who also has been immersed in issues relating to E-
commerce.
  Mr. DOGGETT. Mr. Speaker, I am pleased to rise in support of this 
resolution on keeping the Internet a global tax-free zone. We must 
achieve a global consensus on banning tariffs and discriminatory 
taxation on electronic commerce.
  The gentleman from California (Mr. Cox) has provided leadership last 
year in gaining approval of the Internet Tax Freedom Act. I joined with 
him then and I believe that all the reasons that we advanced for 
supporting that moratorium on taxes by 30,000 potential taxing 
jurisdictions here in America, all of those reasons apply around the 
globe to the need for a global free trade zone and limitation on 
taxation.

                              {time}  1100

  While currently none of the members of the World Trade Organization 
are imposing tariffs, it is very crucial that we prevent new barriers 
from arising.
  Clearly, the imagination for new forms of taxation and new 
restrictions on trade seems unlimited. A bit tax, for example, which 
could be levied on every bit of digital data that is transmitted over 
the Internet, would significantly impair the expansion of electronic 
commerce.
  The high-technology community that I represent in Austin, Texas, has 
been a driving force for growth throughout our State. Fortune Magazine 
calls Austin the best place in the country to do business. And in large 
measure this is the product of the environment we have created with 
high technology.
  Meanwhile, the United States is the world leader in high-technology 
research and development. The actions that have already been taken by 
this Administration and the actions that this resolution urges will 
solidify our Nation's competitive edge in the world economy.
  In 1995, I believe there were about 3 million people who were 
Internet users. Today, we are at about 200 million. And within 5 years 
we are expected to have a billion Internet users around the globe.
  Clearly, an Internet Global Free Trade Zone will foster continued 
growth, and not only benefit one of the

[[Page 26818]]

most important engines driving our strong economy, but it will also 
benefit consumers at home and abroad, who will be encouraged to get 
connected. And this also means more good high-paying jobs here in the 
United States, and it means more opportunity for the citizens of the 
world to share in this important new revolution in technology.
  We need no tax on e-mail and no tariffs or other trade restrictions 
on the Net.
  I applaud the Administration for what it has already done in placing 
this important agenda item on the list of top priorities when the World 
Trade Organization convenes in Seattle, I thank the gentleman from 
California (Mr. Cox) for his continued leadership to ensure that 
government does not impede continued expansion of electronic commerce.
  Mr. CRANE. Mr. Speaker, I yield 2 minutes to the gentleman from 
Virginia (Mr. Goodlatte).
  Mr. GOODLATTE. Mr. Speaker, I thank the gentleman for yielding me 
this time, and I rise in strong support of this resolution and to 
congratulate my colleague, the gentleman from California (Mr. Cox), for 
introducing it.
  This important resolution would direct the U.S. representatives to 
the upcoming World Trade Organization summit in Seattle, Washington, to 
advocate making the moratorium on Internet taxation that was adopted at 
the 1998 WTO conference a permanent Internet tax moratorium.
  Mr. Speaker, I worked closely with the gentleman from California to 
move legislation through the House in 1998 that placed a moratorium on 
new taxes on the Internet. This important legislation set the standard 
for other nations around the world to follow. As a result, the Internet 
remains relatively free from the burdens of special and new taxes, and 
we must continue to put pressure on our fellow nations that would seek 
to tap this booming economic resource and destroy much of its momentum.
  Mr. Speaker, we cannot stand by and assume that the rest of the world 
holds the same distaste for taxing the Internet. That is why we must 
continue to work actively through measures such as this one to keep the 
Internet free from new taxes. This includes monitoring the ongoing 
deliberations of the commission set up by the Internet Tax Freedom Act 
passed by Congress in 1998. This commission, chaired by the governor of 
my home State of Virginia, Jim Gilmore, will hopefully return to 
Congress next year with recommendations to retain the no-new-tax policy 
that has made this medium so successful.
  In the meantime, Mr. Speaker, we must send a message to our fellow 
nations gathering in Seattle next month that to permit taxation of the 
Internet is to infect it with a virus that will slowly sap its 
strength, weakening and ultimately destroying the extraordinary growth 
that has revolutionized the way we live, work, and learn.
  I urge my colleagues to support this important resolution.
  Mr. LEVIN. Mr. Speaker, I yield 3 minutes to the gentleman from 
Virginia (Mr. Moran).
  Mr. MORAN of Virginia. Mr. Speaker, I thank the gentleman for 
yielding me this time. I obviously have a bias on this issue. I 
represent a district that is the most wired in the country, which 
probably means it is the most wired in the world, with 59.9 percent of 
all the households in the northern Virginia area wired with the 
Internet. So, obviously, I do not want any taxation on Internet 
transactions.
  We know that ``wired communities'' are going to be at the cutting 
edge of the enormous growth of this industry. The resolution itself 
says that electronic commerce between businesses is going to grow to 
$1.3 trillion in another 3 years and that, in fact, the electronic 
retail sales are going to amount to about $108 billion. With 200 
different nationalities with their own different sovereign forms of 
government, I cannot imagine how we could implement a bit tax. We do 
not want it. It is going to impede the progress of spreading 
information technology throughout the world.
  We do need to keep in mind, however, that this is still an open 
issue. Legislatively, it is still an open issue before us. There is 
only a moratorium on Internet taxation. There is a commission that we 
put together to address the long term issues surrounding internet 
taxation composed of businesses, States, localities and Federal 
officials, determining what we do about a couple of major problems. One 
of them is what do States and localities do when Internet, e-commerce, 
takes over from traditional retail commerce? What do they do with the 
loss of revenue? How do we make it up to our schools, our roads, our 
public safety, et cetera? They are currently dealing with that issue.
  The other issue is what do we do with the retail centers of 
activities in our cities and towns? If e-commerce is going to be the 
way that we normally purchase a product, it has profound implications 
for the physical centers of our communities across the country. We have 
to deal with those issues.
  Now, I am admitting a bias. I do not want taxation on any e-commerce, 
because that would be in the interest of my constituency. But we have 
also got to listen to the State and local officials who can see what is 
coming from places that, while they may be wired, are desperately in 
need of the tax revenue from retail transactions that will be made 
uncompetitive if our economy goes the way of e-commerce. It is far more 
convenient and it is less expensive. E-commerce, in fact, is always 
going to be less expensive compared to traditional sales if it is not 
taxed. It is not fair to have retail establishments taxed, yet people 
who are selling the same product on the internet are not taxed because 
we prohibit taxation of those products. That has got to be resolved.
  If we go in this direction, which I think ultimately we will, how do 
we make up for the loss of revenue to our States and localities? We 
have to deal with this. We are the Nation's leaders, and it is 
incumbent on us to resolve these issues now before we make permanent 
such a profound change in our private retail and public revenue 
structures.
  Mr. CRANE. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio 
(Mr. Oxley).
  Mr. OXLEY. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, as we send Ambassador Barshefsky to the WTO Ministerial 
in Seattle next month, the world is on the verge of a crucial decision 
for electronic commerce. Will it remain duty and tariff free?
  We are here today to say, yes, it should. That is the consensus here 
in the United States about what is best for the growth and development 
of e-commerce. But other countries in the world are not so sure, and 
that is why we are backing Ambassador Barshefsky in her efforts that 
will be undertaken at the WTO Ministerial meeting in Seattle 5 weeks 
from now at a session that many of us will be attending.
  This week, I am circulating a letter to Ambassador Barshefsky for 
Members' signatures that share the same spirit as the Cox resolution. 
We need strong congressional support to show the world that the United 
States stands firmly opposed to any taxation of e-commerce.
  The imposition of tariffs and duties on electronic services or 
information will only mean that they will become less available to the 
world. Unless cyberspace is tax free, how will people in developing 
nations have consumer choice? In my view, the tariff moratorium should 
be made permanent. It should be as broad as possible to cover the wide 
array of what is available electronically.
  This decision in Seattle is no doubt going to be a difficult choice 
for developing nations strapped for revenue while watching the Internet 
grow exponentially. It is the principled choice, however, and I believe 
the right conclusion will be reached in Seattle with the leadership of 
our delegation and others who agree with this policy.
  The U.S. leads the world in the software industry. The fact is that 
we live in an age where the downloading of software is an export 
directly to a consumer. It has never touched the hands

[[Page 26819]]

of a government agent at a post office, a shipping port, or an airport. 
That freedom of government intrusion is what we hope to protect.
  Mr. Speaker, if the world fails here, we will see an immediate rash 
of tariffs, customs duties, and other trade barriers. The only possible 
result is the limitation of available information and services, and 
that cuts to the very heart of what the Internet does so well.
  I ask strong support for the Cox resolution.
  Mr. CRANE. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York (Mr. Fossella).
  Mr. FOSSELLA. Mr. Speaker, I thank the gentleman from Illinois for 
yielding me this time, and I compliment the gentleman from California 
(Mr. Cox) for his steadfast efforts to keep everybody's paws off 
economic commerce, or e-commerce.
  I think this is an essential resolution, and it is a signal to other 
folks around the world just to say no to imposing taxes on Internet 
sales. We have seen the development and unprecedented growth of the 
Internet and e-commerce and what it means to the American taxpayer, 
what it means to the person sitting at home who now has the luxury that 
several years ago was only a dream. And what we are saying is we want 
to continue that growth; we want to continue the opportunities that 
occur daily. People sitting across this country and, indeed, across the 
world recognize the endless possibilities of what the Internet means to 
e-commerce.
  So many governors across this country, so many people recognize when 
we tax something unnecessarily, we are hurting commerce, we hurt 
growth, and we destroy opportunity. What we want the WTO to do, and 
what we want our ambassador to do is to send a signal to everyone 
around the world to keep their paws off consumers' wallets.
  There are those who say, well, if we do not tax e-commerce then we 
will affect sales tax revenues and miss out on the windfall. I have got 
some words for those folks. We are taxed too much. I see it every day 
in New York. People go across the bridge to New Jersey because there is 
no sales tax on clothing. That is the way people think. They go to 
where they can find the cheapest price. That is human nature.
  So, if anything, we should build a wall here not to impose taxes on 
e-commerce and hope that other folks around this country will start 
lowering the tax burden on hard-working folks with families. But in 
spite of that, the last several years what we have seen and witnessed 
in this country, as e-commerce has grown, so too have sales tax 
revenues.
  So I think those concerns are misplaced. And, if anything, we should 
be dedicating our efforts to reducing the tax burden on hard-working 
Americans while at the same time prohibiting new taxes on e-commerce.
  Mr. LEVIN. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. CRANE. Mr. Speaker, I yield myself the balance of my time to 
conclude with one final observation, and that is, in response to the 
concerns expressed by our ranking minority member on the full Committee 
on Ways and Means, the gentleman from New York (Mr. Rangel), and the 
ranking member on the Subcommittee on Trade, the gentleman from 
Michigan (Mr. Levin), about the failure to have held hearings on this 
issue.
  We have been under tight constraints, but let me just remind everyone 
that this is not mandating anything. It is simply urging the U.S. to 
seek a global consensus on this issue. I am sorry that we did not have 
the hearings that the gentleman said he would have liked to have seen; 
but hopefully, as we go down the line, we will have increased 
opportunities for that. But right now I would urge all my colleagues to 
support this measure.
  Mr. RANGEL. Mr. Speaker, will the gentleman yield?
  Mr. CRANE. I yield to the gentleman from New York.
  Mr. RANGEL. I say this with all deference and respect to my dear 
friend from Illinois, Mr. Speaker. It is not just this one bill that we 
are talking about. We expect that another tax issue will be coming up 
on the suspension calendar. If I thought it was just a question of 
time, I would not resent it.
  Mr. WU. Mr. Speaker, I rise today in strong support of H. Con. Res. 
190, a bill to place a moratorium on electronic commerce taxation. It 
is crucial that Congress works to provide a tax-free environment for 
the Internet to grow.
  Mr. Speaker, during this past decade, the United States has witnessed 
the longest peacetime economic expansion in recent memory. Indeed, e-
commerce has contributed to much of this decade's economic growth. It 
is estimated that over 140 million people worldwide are now online. In 
the United States alone, the information technology industry accounted 
for more than one-third of the real growth in the gross domestic 
product over the past 3 years, employing more than 7 million workers.
  In my home State of Oregon, ``the Silicon Forest,'' in communities 
like Portland, Beaverton, and Hillsboro--e-commerce has been 
responsible for a remarkable economic recovery, and boom, over the past 
decade. We in Oregon have benefited from the strong growth of the 
information technology industry. Oregon companies, large and small, 
have benefited from the growth of the Internet.
  Although electronic commerce still constitutes a relatively minor 
part of global trade, technological advances and key trade policy 
decisions will surely facilitate the further growth of this important 
industry. In the upcoming years, electronic commerce is expected to 
grow by leaps and bounds. Congress must commit itself to work with the 
international community to pave the way for this important industry to 
grow.
  Furthermore, like all other business transactions, it is crucial to 
achieve uniformity within the information technology industry, such as 
a universally accepted form of electronic signature. By encouraging and 
developing a system of standards, Congress can further assist the 
growth of e-commerce.
  Mr. Speaker, I strongly support this important legislation. Let's 
continue to encourage the growth of the information technology industry 
and America's economy. I urge my colleagues to support H. Con. Res. 
190.
  Mr. DAVIS of Virginia. Mr. Speaker, I rise today in favor of H. Con. 
Res. 190, a resolution which extends the work initiated by my 
colleague, Mr. Cox, last year, on extending the moratorium on Internet 
taxation to the international arena. This important piece of 
legislation urges the United States to seek a global consensus now that 
supports a moratorium on tariffs and on special, multiple, and 
discriminatory taxation of electronic commerce. It does so by calling 
on the World Trade Organization to enact a permanent moratorium on e-
commerce tariffs at its Seattle ministerial meeting next month. With 
none of the WTO's 130 members currently taxing Internet commerce, it is 
imperative that we implement a global strategy that ensures that the 
Internet remains tax free before such barriers are erected.
  With Internet use and global electronic commerce growing at an 
astronomical pace, it is inarguable that the Internet is emerging as 
the most unique and the fastest-growing tool of communication known to 
mankind. The Internet facilitates not only economic growth but the easy 
dissemination of ideas and information from almost any spot in the 
world. We are at the tip of the iceberg in terms of the potential that 
the Internet can offer both cheaply and quickly. Yet an ever-present 
concern plagues many of us who--like my colleagues standing with me 
here today--understand the need to foster its continued growth by 
minimizing the amount of government regulation and taxes that will 
interfere with the transformation of the Internet into the repository 
of global communications for the 21st century. H. Con. Res. 190 is a 
critical component of ensuring that government does not inhibit the 
growth of the Internet, whether intentionally or unintentionally. 
Various schemes of taxation introduced by governments across the world 
will make the internet an unpredictable environment for even simple 
communications; much more so for conducting online business. Such a 
development would most certainly discourage the easy and efficient use 
that the Internet now provides for users worldwide.
  Last year, we enacted the Internet Tax Freedom Act which codified a 
policy against special, multiple, discriminatory Internet taxation and 
urged the United States to seek international agreements that would 
concertize those same principles globally. With the July 1999 United 
Nations Report urging sovereign states to impose ``bit taxes'' on 
electronic transmissions, it is incumbent now more than ever for 
Congress and the United States to take the lead in opposing any 
taxation of electronic commerce globally that would inhibit the 
continued economic and social growth of the

[[Page 26820]]

Internet. The resolution specifically urges the President to oppose a 
United Nations or any other international organization's proposal to 
establish a ``bit tax.''
  It is also important that we utilize every available opportunity to 
press for an Internet tax moratorium and for this reason, H. Con. Res. 
190 also calls on the Organization for Economic Cooperation and 
Development to adopt the principle of ``no multiple, discriminatory, or 
special taxes'' on the Internet or on electronic commerce.
  Each of the principles expressed in this crucial measure are equally 
important to the future of the Internet. I want to thank my colleagues, 
Mr. Cox and Mr. Sessions, for introducing this resolution and for 
moving it forward quickly. I urge all Members to vote in favor of H. 
Con. Res. 190.
  The SPEAKER pro tempore (Mr. Kolbe). The question is on the motion 
offered by the gentleman from Illinois (Mr. Crane) that the House 
suspend the rules and agree to the concurrent resolution, H. Con. Res. 
190, as amended.
  The question was taken.
  Mr. CRANE. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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