Electronic Commerce, Internet Tax Panel Off To Slow Start

A congressional committee charged with making recommendations on how taxes should be applied to Internet commerce got off to a slow start Monday as members were unable to reach a consensus on how to fund the group’s operations.

When Congress created the group last year to study Internet taxation and related issues, it did not set aside any money to fund its operations. Committee members estimate $1.7 million is needed to finance their study which must be submitted to Congress by April 21, 2000.

The committee is comprised of representatives from business and government. Committee members say they are concerned about being able to raise funds while avoiding the appearance of a conflict of interest or excessive dependence on corporate donations.

Concerns that corporations would dominate the committee’s activities surfaced earlier this year when the National Association of Counties and U.S. Conference of Mayors sued to force an equal balance between corporate and government members. After the suit was filed, former Netscape chief Jim Barksdale agreed to resign and was replaced by a Washington County, Ore., commissioner.

Virginia Gov. James Gilmore, who was elected as the group’s chairman, got his legislators to agree to provide $150,000 to fund the committee’s initial work. After other government members balked at his suggestion that every member contribute a maximum of $150,000, Gilmore appointed a five-member group including, AT&T Corp. Chairman C. Michael Armstrong and MCI WorldCom’s John Sidgmore, to proposean interim solution that would fund the group with a mix of corporate and public money.

The group also postponed action on Gilmore’s choice for an executive director, saying they wanted more time to review the candidate’s qualifications.

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