PPI In the News

WSJ: Obama’s New Web Tax

The Wall Street Journal editorialized PPI’s recent policy brief by Hal Singer and Bob Litan, Outdated Regulations Will Make Consumers Pay More for Broadband.

Now the Progressive Policy Institute reports that state and local regulators would join with the feds in gouging Internet consumers. That’s because states and localities have their own levies that would kick in if the Internet is officially deemed a monopoly telephone network. Authors Robert Litan of the Brookings Institution and PPI’s Hal Singer optimistically expect regulators to reduce the federal levy from the current 16.1%. But the analysts still forecast significant pain for Internet users.

“We have calculated that the average annual increase in state and local fees levied on U.S. wireline and wireless broadband subscribers will be $67 and $72, respectively. And the annual increase in federal fees per household will be roughly $17. When you add it all up, reclassification could add a whopping $17 billion in new user fees,” report Messrs. Litan and Singer.

That’s in addition to “the planned $1.5 billion extra to fund the E-Rate program,” which subsidizes schools and libraries. The authors add that the “higher fees would come on top of the adverse impact on consumers of less investment and slower innovation that would result from reclassification.”

Read the entire piece at The Wall Street Journal.