Educational CyberPlayGround ®

Domain Name Tax Illegal, Judge Rules

From: Kevin Taglang <kevint@BENTON.ORG>


Title: Domain Name Tax Illegal, Judge Rules

Source: Washington Post (F4)


Author: Mike Mills

Issue: Internet Domains

Description: U.S. District Judge Thomas F. Hogan held that a $30 fee assessed on Internet address holders was an illegal tax because it was devised by the Nat'l Science Foundation and Network Solutions instead of by Congress. Judge Hogan wrote that "unless Congress acts to ratify the collection of the [fee], plaintiffs may be entitled to a refund of the taxes that they have paid." The $30 has gone into a gov't. "Intellectual Infrastructure Fund" for the Internet and is part of a $100 fee charged by Network Solutions to those who want to register Internet domain names. Judge Hogan ruledthat Network Solutions didn't violate the law in charging the other part of the fee, saying the company is merely being compensated for the service of providing domain names to customers.


Title: Judge Calls Internet Registration Fee Illegal

Source: New York Times (CyberTimes)


Author: Jeri Clausing

Issue: Internet Domains

Description: Federal Judge Thomas F. Hogan, of Federal District Court in Washington, ruled yesterday that a $30 fee collected on millions of Internet domain registrations is an illegal tax. This decision puts in limbo a $50 million federal fund that was designated in part to help fund research on the Next Generation Internet. William Bode, the lawyer who brought the suit, said he hoped this ruling would translate into millions of refunded dollars for people who registered domains over the past two years. Beth Gaston, a spokeswoman for the National Science Foundation, said it was unclear what would happen to the fund. "Obviously we are disappointed with the district court decision," she said. "Right now we are reviewing it to see what our options are." Judge Hogan said the tax was illegal because it had never been specifically authorized by Congress. "Congress may have intended to grant the NSF the authority to collect the assessment, but it has not done so yet," Hogan wrote. "It still retains the power to ratify the collection even at this late date," he added. "However, if it wishes to effect such a ratification and permit NSF to use the Intellectual Infrastructure Fund, Congress must pass legislation that more explicitly conveys its intentions."