President Bush: Don’t Tax Broadband Access

President Bush today reaffirmed a goal to bring high-speed Internet access to every part of the country by 2007 and reiterated broadband technology should not be taxed.

“Broadband technology must be affordable. In order to make sure it gets spread to all corners of the country, it must be affordable. We must not tax broadband access,” Bush said today during a speech before the American Association of Community Colleges Annual Convention in Minneapolis, Minn. “If you want broadband access throughout the society, Congress must ban taxes on access.”

During a speech last month in Albuquerque, N.M., the president said the country must have universal affordable access to broadband technology by 2007, adding the government does not need to tax access to broadband service.

The U.S. Senate is currently in discussions on whether to impose state and local taxes on Internet access. One bill would permanently ban taxation of Internet access and services and expands the definition to include DSL and wireless platforms as well as cable modem service, according to the New Millennium Research Council. Another bill would extend a now-expired moratorium on state and local taxation of cable modem service by two years, the NMRC says, but consumers using DSL or wireless platforms would have to pay state and local taxes.

During his speech today, the president also supported the FCC’s decision to deregulate the broadband market, said the government should make more wireless spectrum available for free public use, endorsed increased access to federal land for fiber-optic cables and transmission towers and advocated new technical standards to make possible new broadband technologies such as high-speed Internet access over power lines.

The president supported FCC Chairman Michael Powell’s decision last year to eliminate regulations on new broadband networks. The rules free the biggest local phone companies from having to lease newly constructed networks to competitors.

“Secondly, a proper role for the government is to clear regulatory hurdles so those who are going to make investments do so,” Bush said. “Broadband is going to spread because it's going to make sense for private sector companies to spread it so long as the regulatory burden is reduced -- in other words, so long as policy at the government level encourages people to invest, not discourages investment.”

The president said the number of broadband customers has tripled since 2000, yet the U.S. ranks tenth among industrialized countries in the availability of high-speed Internet service.

“That's not good enough for America. Tenth is 10 spots too low as far as I'm concerned,” he said.

During his speech, the president did not cite controversial phone rules that created a rift between fellow Republicans FCC Chairman Powell and FCC Commissioner Kevin Martin. A federal appeals court has overturned the phone rules, but the government may ask the Supreme Court to review the regulations.

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