United Nations to consider tax for Internet giants in the US

By on June 11, 2012, 8:30 AM

Apple, Facebook, Google and Netflix could be among those affected by a leaked Internet tax proposal via the United Nations. The proposal would force large web companies to pay fees to serve non-US residents for consuming bandwidth, potentially limiting their global reach.

The documents reveal that the proposal will go up for debate in December during a meeting of the International Telecommunication Union. The European Telecommunications Network Operators Association (ETNO), a group that represents companies in more than 30 countries, is responsible for drafting the proposal. It would reportedly amend an existing treaty and could additionally allow governments to monitor and restrict Internet access in certain countries.

Telecommunications companies like France Telecom, Telecom Italia, and Vodafone Group have been lobbying for such a treaty for some time. They feel that large content providers should be required to pay a fee linked to consumption of their services to offset the cost of bandwidth on their end.

In response to the leak, the ETNO told CNET that they feel the proposal is innovative and their entire executive board agreed with its adoption. Of course, not everything thinks this is a wise idea.

Cisco vice president for global technology policy Robert Pepper predicts that US Internet services would simply reject foreign traffic rather than pay the potentially costly fees, a move that would result in less revenue for US-based Internet companies and provide fewer multimedia options for people in developing countries.

Tax rates weren’t mentioned in the proposal but experts believe they could reach billion of dollars annually.

Add New Comment

TechSpot Members
Login or sign up for free,
it takes about 30 seconds.
You may also...
Get complete access to the TechSpot community. Join thousands of technology enthusiasts that contribute and share knowledge in our forum. Get a private inbox, upload your own photo gallery and more.