1998-071-Supporting Compromise Proposal To The California Internet Tax Freedom ActRESOLUTION 1998 - 71
RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS
SUPPORTING COMPROMISE PROPOSAL TO
THE CALIFORNIA INTERNET TAX FREEDOM ACT (AB 1614)
WHEREAS, AB 1614, the California Internet Tax Freedom Act, sponsored by
Assemblyman Ted Lempert is pending the California State Assembly; and
WHEREAS, AB 1614, the California Internet Tax Freedom Act, prohibits any tax or fee
directly or indirectly on, or in connection, with the internet, or any interactive computer services,
with specified exceptions preserving existing tax authority of the State and its political
subdivisions; and
WHEREAS, local governments have expressed concerns that the current legislation could
be interpreted to reduce or eliminate current taxes and fees collected by local government to
support essential Town services; and
WHEREAS, local governments have opposed legislation that does not provide for a
mechanism to fully protect existing revenue sources to local governments, including sales and use
tax, utility franchise fees, etc; and
WHEREAS, State and local leaders recognize that businesses, especially internet
businesses that transcend state borders, cannot be expected to keep track of different rules for
6,000 taxing jurisdictions and there is a need to significantly simplify the sales tax systems; and
WHEREAS, the local governments support a sunset on the moratorium that restricts the
ability of the State and any of its political subdivisions to develop a comprehensive, long term,
and equitable solution to streamline the outdated and burdensome sales tax system to ensure that
American business, government„ and consumers are well positioned to prosper n the 21st century
global marketplace; and
WHEREAS, industry representatives have expressed concerns that, without legislation,
the State and any of its political subdivisions may impose any tax or fee "directly or indirectly on,
or in connection with" the internet, any interactive computer service which would be considered
either new or discriminatory on internet services; and
WHEREAS, both local government and industry representatives have identified two areas
of agreement - preservation of the unrestricted growth of the internet and protection of existing
Town revenue sources; and
Page 1 of 2
WHEREAS, local government and industry representatives have jointly drafted a
compromise proposal in the nature of a substitute to the September 15, 1997 version of AB 1614,
The California Internet Tax Freedom Act.
NOW, THEREFORE, BE IT RESOLVED, that the Town of Los Gatos supports the
compromise proposal and urged Assemblyman Lembert to amend the existing AB 1614 by
substituting the draft language attached to this resolution.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los
Gatos, California, held on the 26th day of May, 1998 by the following vote:
COUNCIL MEMBERS:
AYES: Randy Attaway, Joanne Benjamin, Steven Blanton, Jan Hutchins,
Mayor Linda Lubeck
NAYS: None
ABSENT: None
ABSTAIN: None
SIGNED:
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS. CALIFORNIA
ATTEST:
CLERK OF THE TOWN OF LOOS
LOS GATOS, CALIFORNIA
Page 2 of 2