Publication Date: July 2004
Publisher: Center on Budget and Policy Priorities (Washington, D.C.)
Author(s): Michael Mazerov
Research Area: Media, telecommunications, and information
Keywords: State budgets; Economic projections; Information technology; Telecommunications
The Senate Commerce Committee is scheduled to mark up S. 2281, the â€œVOIP Regulatory Freedom Act of 2004â€ on July 22. Sponsored by Senator John Sununu, S. 2281 would limit the application of existing federal and state telecommunications regulations to new â€œvoice over Internet protocolâ€ (VOIP) technologies. In a variety of ways, these technologies use the Internet itself or the Internetâ€™s underlying â€œlanguageâ€ to carry telephone calls. As is the case with e-mail and World Wide Web â€œpages,â€ VOIP breaks voice phone calls into small digital â€œpacketsâ€ that are transmitted over various public and private telecommunications networks and then reassembled into voice at the receiving end.
S. 2281 does not address only regulatory issues, however. Section 7 of the proposed legislation provides that â€œNo state or political subdivision [thereof] shall impose any tax, fee, surcharge, or other charge for the purpose of generating revenues for governmental purposes on the offering or provision of a VOIP application.â€ This is a major problem because it is widely anticipated that all or nearly all voice communication eventually will be transmitted using Internet protocol-based technologies.