The Show Me State must allow VoIP technology to develop and flourish throughout the state without regulatory interference, said the Institute for Policy Innovation in testimony to the Missouri legislature today.

VoIP is a compelling application which will encourage economic advancement, job creation and income growth as it is a "better, cheaper, and faster" vehicle for voice communications.

"These sorts of technology innovations are the prime drivers of economic growth because they increase productivity of businesses and enterprises large and small," said IPI President Tom Giovanetti.

Missouri must resist the urge to regulate. The Missouri Public Utilities Commission is showing a strong inclination toward regulation of the VoIP market, and throughout the recent report from the VoIP Task Force, the Commission expresses distrust in markets and competition.

"Missouri must show bold leadership, not by being the first state to attempt to tax and regulate an exciting new technology, but rather by reining in the regulators," said Giovanetti.

It is vital to prevent discriminatory treatment of any technology or application. Legislators should not choose winners or losers in the communications sector. It makes no sense to tax the risk-taking companies who are creating jobs by investing and building out infrastructure in Missouri.

"We ought to be praising and rewarding the facilities-based providers who are doing the favor of building out a critical broadband infrastructure using their own risk capital," said Bartlett Cleland, Director of the IPI Center for Technology Freedom.

Those who feed from the public trough are the same ones advocating regulation and taxation. Many of the smaller and rural telecom providers that support regulation and taxation of VoIP are also the companies whose entire business models are dependent upon being recipients of public subsidies in the form of universal service fees. These companies already receive public assistance, and are trying to slow their competitors' adoption of exciting technology by loading it with new taxation and regulation.

A disproportionate tax burden already weighs upon communications. The only industries that bear a heavier tax burden are cigarettes and alcohol. Communications consumers' final bills are often a whopping 40 to 50% taxes and fees.

"These are dishonest, hidden taxes," said Cleland, "It makes no sense for one of our most critical industries to be bearing such an inordinate tax burden."

If Missouri wants to be competitive in the communications market and to entice new and technologically advanced infrastructure, the state should relax regulation rather than increase it.

Cleland concluded by asking: "Missouri now has the opportunity to add marketplace power alongside historic mule power in state leadership history, but will it?"