By now we have all heard the rumblings regarding whether or not to tax the Internet. The issue first appeared before the majority of the public in October of 1998 when President Clinton signed the Internet Tax Freedom Act (P.L. 105-277; 47 U.S.C. §151 (1998)). The Internet Tax Freedom Act became known as the "moratorium" on Internet taxes that extended from October 1, 1998 through October 21, 2001.
The ITFA therefore established a three-year period in which certain taxes could not be imposed on Internet by State and Local governments. The moratorium also prohibited taxes on certain transactions associated with the Internet. However, the issue gained much greater public recognition after the creation of The Advisory Commission on Electronic Commerce (ACEC), which was a part of the ITFA. The ACEC was to make recommendations to Congress with respect to whether or not the Internet should be taxed, and if so, how the Internet should be taxed. The ACEC's report was submitted to Congress
