President George W. Bush signed into law on October 31, 2007
legislation (House Bill 3678,[1] the Internet Tax Freedom Act Amendments Act of 2007) that extends for another seven years, until November 1, 2014, the moratorium precluding state and local taxes on Internet access and multiple and discriminatory taxes on electronic commerce.[2] The new Internet Tax Freedom Act (hereinafter the “2007 ITFA”) also amends the previous law in several significant ways. Among the most important changes are that the 2007 ITFA: (1) amends the definition of “Internet access” to help clarify the nature and scope of services protected from state taxation under the moratorium; (2) extends for seven years but clarifies, both retroactively back to November 1,
2003 and going forward, the provisions grandfathering certain states that have historically taxed Internet access; and (3) excepts certain general business gross receipts taxes from the scope of prohibited taxes on Internet access.
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