Bipartisan Cohen-Smith Bill to Protect Consumers From Unfair Taxes On Digital Goods Approved by Judiciary Committee

[WASHINGTON, DC] – The Digital Goods and Services Tax Fairness Act of 2015, which was introduced earlier this year by Congressman Steve Cohen (TN-09) and Chairman of the House Science, Space, and Technology Committee Lamar Smith (TX-21) to protect consumers from unfair taxes on digital goods, was approved by the House Judiciary Committee today on a voice vote and now awaits consideration by the full House. The legislation, H.R. 1643, would ensure that digital goods like those purchased over the Internet or on smartphones are not taxed at a higher rate than their tangible counterparts. It would also protect consumers from tax discrimination based on their choice to purchase a good in digital rather than tangible form.

“Digital goods and services are quickly becoming a driving force in our national economy,”said Congressman Cohen.“We should ensure that consumers aren’t discouraged from purchasing digital goods because of high taxes, and our Digital Goods and Services Tax Fairness Act would help accomplish such a goal. I am pleased the Judiciary committee has approved our legislation and look forward to it being considered by the full House as soon as possible.”

Chairman Smith said:“In our modern economy, more and more consumers are buying digital goods and services rather than tangible items. Consumers shouldn’t be punished with higher taxes simply because they purchase an e-book instead of a paperback, or download an MP3 instead of purchasing a CD. The Digital Goods and Services Tax Fairness Act of 2015 protects consumers from unfair and duplicative taxes on digital goods. This is the kind of 21st century legislation we need if we want to promote tax fairness and ensure that consumers are not discouraged from purchasing digital goods.”

Representatives Steve Chabot (OH-01), Trent Franks (AZ-09), and Blake Farenthold (TX-27) also cosponsored this legislation. Companion legislation was introduced in the Senate by Senators John Thune (R-S.D.) and Ron Wyden (D-Ore.).