Most people seem to agree that not taxing the Internet is a good idea, but there is strong disagreement from those who fear that a permanent ban would allow any Internet purchase to be free of state and local sales taxes.

Poppycock! A new, permanent bill could specifically set forth that the ban is on access and usage taxes, not on legitimate sales taxes. Certainly the lawyers could work that out (although they might rather fight it out in court and pull in big fees–but that's another topic).

The Center on Budget and Policy Priorities, a liberal-leaning, Washington, D.C.-based think tank, says making the act permanent “could adversely affect state and local government revenues, and therefore the availability of funds for important services like education, health care and law enforcement.”

In other words, making the moratorium permanent could shut off the potential stream of money from our pockets to the leaky coffers of our governments.

Maybe it's just me, but that idea doesn't exactly strike fear into my heart. After all, the government is doing a fine job wasting our money without the extra income to be gained by savaging the Internet.

Interestingly, the equally liberal-leaning Los Angeles Times is in favor of Washington enacting a permanent ban on Internet taxation.

In an online editorial, the media outlet points out that such a move would help keep down the price of broadband service, allowing those with lower incomes better access. They also note, disturbingly, that “several states are poised to institute new taxes on Internet access the moment the current moratorium lapses.”

The think tank added that nine states already derive $80-to-$120 million in annual revenues from “grandfathered” taxes on Internet access services–thus the permanent ban would deprive them of this income.

That's a little bit like saying people shouldn't put buttons on their pants pockets, because the livelihood of pickpockets will suffer as a result.

These states will find other ways to raise money, or–heaven forbid–economize so the additional funds aren't needed. It seems to be working in the other 41 states.

And what effect will additional taxes have on the insurance and financial services industries?

Let's just say that at a time when insurers and agents in particular are trying to get customers to do more buying and business communications online, anything that discourages that activity is a negative factor.

Let's face it: One of the appeals of the Internet is that, other than your minimal ISP fees, access is free of charge.

Congress has never met a tax it didn't like, so don't discount the possibility that it will choose to let the moratorium end. Who knows, they may even find a way to get part of those state taxes funneled to the federal government.

It doesn't seem likely they will do that, however, because allowing taxes on Internet access could be a huge drag on commerce in a U.S. economy that currently features a steadily declining dollar and troubled real estate and mortgage industries.

Even though most of our representatives in Congress are more than capable of hurting the U.S. economy, they would still be wary of being blamed for further decline–and thus, not re-elected.

The most likely scenario is another temporary extension, and that is a shame, because it leaves the door open for another effort to fleece the consumer and to strap ankle weights to an economy that is struggling to get up to speed.

It puts one in mind of the bridge from the Beatles song “Taxman”:

(If you drive a car) – I'll tax the street;

(If you try to sit) – I'll tax your seat;

(If you get too cold) – I'll tax the heat;

(If you take a walk) – I'll tax your feet.