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Can e-mails be taxed?


The Post Office's Piggybank
The U.S. Postal Service’s financial troubles led to a decision to eliminate Saturday mail delivery.
The U.S. Postal Service’s financial troubles led to a decision to eliminate Saturday mail delivery.
© Kevork Djansezian/Getty Images

In the U.S., the Postal Service has been losing money at a head-spinning rate for a very long time. That's due partly to the popularity of e-mail, which has contributed to a more than 25 percent drop in mail volume since 2010. In just the last quarter of 2012, the agency lost $1.3 billion, and to stop the bleeding, it decided to nix Saturday mail delivery [source: Reuters]. Surely, if there's an organization worth saving through taxation, it must be the USPS. Right?

Enter Bill 602P, which would theoretically levy a 5-cent tax on every e-mail. That money, of course, would be funneled to the USPS. Never mind that the USPS has absolutely nothing to do with e-mail.

Only, there isn't any Bill 602P. It's an Internet urban legend spun off from a Canadian version that spouted the same kind of rhetoric. All of the details about 602P are fictional.

That didn't stop the media from reporting on it, though, or from bugging political power players about it. In a 2000 senate race, a television news reporter named Marcia Kramer asked both Hilary Clinton and Rick Lazio about the bill's details. Unsurprisingly, both candidates spoke out against the fabricated tariff.

Although this bill never existed, the storyline behind it has been a pervasive Internet hoax, and one that's difficult to completely quash.

It's not hard to see how this kind of rumor could start. The hoax plays right into the highly publicized struggles of an iconic (and increasingly irrelevant) institution. Also, since online shopping became so popular, there's been persistent confusion about how different states and countries apply sales taxes. Online sales tax and e-mail tax are two very different things, but when you add in a dash of fear and anger about taxation in general, you wind up a good recipe for a lot of uproar about nothing.

At present, there are actually laws in place protecting against these kinds of taxes. In 1998, President Bill Clinton signed the Internet Tax Freedom Act, which prohibits governments at every level from applying Internet-only taxes upon consumers. That includes, of course, those fictional bit taxes and e-mail taxes, as well as bandwidth taxes.

Laws can be repealed, of course. And some people say this one should be changed so that governments can finally tap into e-mail transfers for revenue. So don't put away your pitchfork just yet. There might still be some tea that needs to be tossed into the sea.