Ted Cruz Backs Internet Tax Ban That Would Cost Texas $358 Million a Year

Sen Ted Cruz (R-TX) is lobbying hard to prevent government regulation of the Internet, but one measure he supports is expected to create a sizeable budget hole for his state.

Sen Cruz, a likely presidential candidate in 2016, spent ample time promoting a permanent extension to an expiring ban on federal, state, and local taxation of Internet access that is currently being considered in Congress. The measure, which passed the House earlier this year, is popular in both parties and considered a lame-duck "must pass," as the ban is set to lift on Dec. 11. But a lesser-known consequence of the bill is that it would also end Internet access taxes currently in place in seven states -- Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Wisconsin, and, yes, Texas. These states are the only ones that can charge residents for Internet access thanks to a grandfather clause in the original Internet-tax moratorium -- first passed by Congress in 1998 -- that carved out an exemption for states that had already begun to cash in.