Congress put a temporary ban on Internet access taxes in 1998 to nurture what was then a fledgling industry. The idea: An Internet free from a tax burden would grow more quickly, encouraging a more productive U.S. economy.

The ban has been extended twice and would have expired Thursday but for an 11th-hour compromise between the House and Senate that will extend the moratorium for seven more years.

Interestingly enough, there was little enthusiasm to impose taxes on Internet service. You enjoy a tax break here that you don’t enjoy for access to other communication systems, such as telephone and cable TV. But this went down to the wire because the Senate wanted to make the ban permanent, and the House wanted to extend it just an additional four years. The Senate OK’d the compromise by voice vote last week, and the House voted 402-0 to go along Tuesday. President Bush signed the extension Wednesday.

It’s an interesting experiment, to see if a tax-free environment encourages customer use, which in turn encourages capital investment in high-speed lines. It’s an experiment we would like to see continue … at least for a while. But should the feds tell state and local governments that this one vibrant sector of the economy will always remain out of their tax reach? No. Let’s see where things stand in seven years.

The Senate and House were smart to resolve this. There was concern that the Internet would suddenly be targeted by states and cities if the moratorium had been allowed to expire. The ban lapsed for nearly a year before it was extended the last time, in 2004, and during that time, no new states imposed access taxes. (Nine states have access taxes because they created them before 1998. They will be allowed to keep those taxes under the legislation signed by the president.)

But the Internet is a bigger target now. And when government tries to take revenue from communications, there seems to be no end to its lust. Telephone taxes and fees make up about 20 percent of the average monthly residential bill.

The compromise spells out what Internet services would be off-limits for taxes, specifically prohibiting taxes on e-mail and instant messaging services “that are provided independently or not packaged with Internet access.” That leaves the door open to taxes on VOIP (Voice-Over-Internet Protocol) service. That seems fair, because it competes with traditional telephone service, which is subject to taxes. Congress isn’t looking to block local governments from tax sources they already tap. “It’s important to make sure that state and local governments are not deprived of revenues raised on services that have nothing to do with accessing the Internet,” said Sen. Thomas Carper, D-Del., a sponsor of the compromise.

Extending the moratorium for seven more years makes sense.

The Chicago Tribune is based in Chicago, Illinois.