WASHINGTON (AP) — An eBay executive warned Wednesday that fewer small businesses would sell products through the Web auctioneer, and elsewhere online, without a permanent ban on Internet access taxes.

Congress first imposed a moratorium on taxing Internet access — which bars state and local governments from taxing the connection to basic Internet content — in 1998. Since then, it has been twice extended, but is set to expire Nov. 1.

Congress is considering legislation that would extend the moratorium for several years or ban it permanently.

While Brian Bieron, eBay Inc.’s senior director of federal government relations, did not directly say the company would suffer without the ban, he said the effect would be far reaching.

“More importantly, fewer consumers will use the Internet,” he said in testimony prepared for a House hearing. “And, for the small businesses using the Internet, that means fewer sales and less opportunity to compete with the mega retailers.”

He estimated more than 720,000 small businesses use the San Jose, Calif.-based company as a primary or secondary marketing channel, calling it a “lifeline” against larger retailers.

Through eBay, he said about 15 percent of sales of U.S. small businesses are exported to other countries and small businesses can also find products from all around the world on the Web site.

Bieron was one of five witnesses to testify before the House Small Business Committee, which
is considering the potential impact on small businesses if the moratorium isn’t renewed.

Rep. Nydia Velazquez, D-N.Y., who chairs the committee, said in her opening statement that if Internet
access is taxed then small businesses could see a 15 to 30 percent increase in their Internet bills.

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