Earlier this week, readers reacted with skepticism after Berkeley City Councilman Gordon Wozniak suggested that taxing email might be one way to raise money for the cash-strapped U.S. Postal Service.
Wozniak told the council: “There should be something like a bit tax. I mean a bit tax could be a cent per gigabit and they would still make, probably, billions of dollars a year… And there should be, also, a very tiny tax on email,” perhaps one-hundredth of a cent. He said this would discourage spam and not have much impact on the typical Internet user. Wozniak went on to suggest a sales tax on internet transactions that could help, in part, fund “vital functions that the post office serves.”
One Berkeleyside Twitter follower called the idea “unworkable insanity.” Wrote another: “This is just insane. Does the esteemed councilman have the first clue how the Internet works?”
But there’s a history to this idea, however outlandish as it might sound to some.
The United Nations Development Program examined such a tax in its 1999 Human Development Report, Globalization With a Human Face, as a way to fund “the global communications revolution.” UNDP calculated that in 1996, such a tax would have raised $70 billion globally.
The New York Times took a brief look at the concept in 2009. Summing up an opinion piece by lawyer Edward Gottesman in the British magazine Prospect (behind a paywall), The Times said Gottesman thought such a tax could be used “to finance the expansion of bandwidth that the Web desperately needs.” He had suggested charging “a few cents per e-mail to cut down on the estimated 90 percent of it that is unwanted spam.”
“Opponents will argue that collecting the tax is impossible or unfair. Yet the status quo is unworkable,” wrote Gottesman. “Since early 2007 the global volume of spam has more than trebled. To stop this blizzard of unwanted messages, ISPs and most large businesses spend a sizeable chunk of their IT budget filtering out obvious junk. Despite this, most of us spend time each day clicking ‘delete’—and the deluge is getting worse. A unit tax on email would stop most spam. A peddler sending 1m messages a day hawking cross-border pharmaceuticals, for instance, would have to balance the uncertain revenues against the tax cost of £100,000 or $150,000 a week. Trying to con people out of money or their bank password would become a risky gamble.”
Advocates of such a tax say that ISPs could levy the tax as part of the monthly bill they charge users.
Harvard Law School’s Jonathan Zittrain, who specializes in cyberlaw and Internet governance, told Berkeleyside today that an email tax was a “terrible idea.”
“To the extent that the cheap flow of flat rate first class mail has positive effects for society at large, the insistence that the Post Office be revenue-neutral may not make sense,” Zittrain said. “Taxing email as an alternative, however, is a terrible idea: bad in theory and truly unworkable in practice. There have been proposals to see fees imposed on email by service providers — or recipients themselves — as a way of minimizing spam, but to impose an external tax on it when there are ready substitutes (Facebook messaging, anyone?), and when collection would be a nightmare, seems a non-starter. There is no reason to tax electronic mail users in particular to save the Post Office, any more than it would make sense to tax coffee drinkers to do it.”
On Wednesday, Wozniak said that, though he’s no expert on Internet taxes, he thinks the idea is worth serious consideration.
“Since many billions of emails are sent every day, an email tax could raise substantial sums,” he said, via email. “Most of the revenue raised could be used to fund the managing and maintaining the Internet Superhighway and a portion to subsidize snail mail. Think of it as analogous to the gas tax used to maintain our physical highways.”
He went on to say that, currently, an email tax is banned by Congress, so a major, top-level policy shift would have to occur before the idea could be put into practice.
In 1998, President Bill Clinton signed into law the Internet Tax Freedom Act “to promote and preserve the commercial, educational, and informational potential of the Internet,” according to Wikipedia. The law forbids federal, state and local governments from taxing web access and “imposing discriminatory Internet-only taxes such as bit taxes, bandwidth taxes, and email taxes.”
The law has been extended several times since its inception, and currently includes a moratorium through November 2014. A commission authorized by the 1998 law was charged with studying national tax policy related to the Internet; its final report opposed Internet taxation, and took a variety of other policy positions.
Conflict alert: Berkeleyside sends out nearly 4,000 emails a day to subscribers to our daily newsletter (to say nothing of the many emails the Berkeleyside staff sends each day). At Wozniak’s rate, our daily email would be taxed about $125 a year.
[Editor’s note: Lance Knobel contributed to this story.]
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