Sec. 1104. GRANDFATHERING OF STATES THAT TAX INTERNET ACCESS
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## SEC. 1104 GRANDFATHERING OF STATES THAT TAX INTERNET ACCESS **[**[47 U.S.C. 151 note](/us/usc/t47/s151)**]** ###
(a)Pre-October 1998 Taxes ####
(1)In general Section 1101(a) does not apply to a tax on Internet access that was generally imposed and actually enforced prior to October 1, 1998, if, before that date— #####
(A)the tax was authorized by statute; and #####
(B)either— ######
(i)a provider of Internet access services had a reasonable opportunity to know, by virtue of a rule or other public proclamation made by the appropriate administrative agency of the State or political subdivision thereof, that such agency has interpreted and applied such tax to Internet access services; or ######
(ii)a State or political subdivision thereof generally collected such tax on charges for Internet access. ####
(2)Termination #####
(A)In general Except as provided in subparagraph (B), this subsection shall not apply after June 30, 2020. #####
(B)State telecommunications service tax ######
(i)Date for termination This subsection shall not apply after November 1, 2006, with respect to a State telecommunications service tax described in clause (ii). ######
(ii)Description of tax A State telecommunications service tax referred to in subclause
(i)is a State tax— ######
(I)enacted by State law on or after October 1, 1991, and imposing a tax on telecommunications service; and ######
(II)applied to Internet access through administrative code or regulation issued on or after December 1, 2002. ####
(3)Exception Paragraphs
(1)and
(2)shall not apply to any State that has, more than 24 months prior to the date of enactment of this paragraph, enacted legislation to repeal the State's taxes on Internet access or issued a rule or other proclamation made by the appropriate agency of the State that such State agency has decided to no longer apply such tax to Internet access. ###
(b)Pre-November 2003 Taxes ####
(1)In general Section 1101(a) does not apply to a tax on Internet access that was generally imposed and actually enforced as of November 1, 2003, if, as of that date, the tax was authorized by statute and— #####
(A)a provider of Internet access services had a reasonable opportunity to know by virtue of a public rule or other public proclamation made by the appropriate administrative agency of the State or political subdivision thereof, that such agency has interpreted and applied such tax to Internet access services; and #####
(B)a State or political subdivision thereof generally collected such tax on charges for Internet access. ####
(2)Termination This subsection shall not apply after November 1, 2005. ###
(c)Application of Definition ####
(1)In general Effective as of November 1, 2003— #####
(A)for purposes of subsection (a), the term “**Internet access**” shall have the meaning given such term by section 1104(5) of this Act, as enacted on October 21, 1998; and #####
(B)for purposes of subsection (b), the term “**Internet access**” shall have the meaning given such term by section 1104(5) of this Act as enacted on October 21, 1998, and amended by section 2(c) of the Internet Tax Nondiscrimination Act (Public Law 108–435). ####
(2)Exceptions Paragraph
(1)shall not apply until June 30, 2008, to a tax on Internet access that is— #####
(A)generally imposed and actually enforced on telecommunications service purchased, used, or sold by a provider of Internet access, but only if the appropriate administrative agency of a State or political subdivision thereof issued a public ruling prior to July 1, 2007, that applied such tax to such service in a manner that is inconsistent with paragraph (1); or #####
(B)the subject of litigation instituted in a judicial court of competent jurisdiction prior to July 1, 2007, in which a State or political subdivision is seeking to enforce, in a manner that is inconsistent with paragraph (1), such tax on telecommunications service purchased, used, or sold by a provider of Internet access. ####
(3)No inference No inference of legislative construction shall be drawn from this subsection or the amendments to section 1105(5) made by the Internet Tax Freedom Act Amendments Act of 2007 for any period prior to June 30, 2008, with respect to any tax subject to the exceptions described in subparagraphs
(A)and
(B)of paragraph (2).
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- Pub. L. 108-435
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