Introduction of Digital Goods and Services Tax Fairness Act

Floor Speech

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Mr. COHEN. Madam Speaker, I rise in support of the Digital Goods and Services Tax Fairness Act, a bipartisan, bicameral bill I introduced earlier today along with my colleague on the Judiciary Committee, Representative John Ratcliffe from Texas, and in the Senate, Senators John Thune from South Dakota and Ron Wyden from Oregon, to curb discriminatory taxation of digital goods and services.

We live in an increasingly digitized world. Digital goods and services make consumption of entertainment media more convenient and have a lighter carbon footprint than their tangible analogs such as e- books, movies, online documents and much more. In addition, many vital health, education, and computer systems have turned to digital goods and services to increase the reliability and efficiency of access to important data.

The lack of a uniform framework for state taxation of digital goods and services has led to a patchwork of state tax laws that confuses consumers and unnecessarily challenges the digital economy. Consumers risk being taxed by multiple jurisdictions for a single download. For instance, three different states can currently tax the same purchase of a digital good or service.

Discriminatory taxes also discourage the new, innovative, emerging technologies and products that American inventors continue to develop.

The Digital Goods and Services Tax Fairness Act would ensure that consumers are not taxed at a higher rate for purchasing digital goods than they are for purchasing tangible goods by establishing a national framework to determine which state has the right to decide whether to tax a digital transaction. It would also protect consumers from potential multiple state taxes on a single digital purchase.

This is common sense legislation that is necessary in our booming digital economy. I urge both the House and the Senate to swiftly pass this bill.

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