To protect children from Internet pornography and support law enforcement and other efforts to combat Internet and pornography-related crimes against children.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Internet Safety and Child Protection 
Act of 2005''.

SEC. 2. PURPOSE.

    The purpose of this Act is to--
            (1) set tighter age verification standards to block minors 
        from entering Internet pornography sites; and
            (2) provide funding and support to law enforcement efforts 
        to combat Internet and pornography-related crimes against 
        children.

                   TITLE I--CHILD PROTECTION EFFORTS

SEC. 101. AGE VERIFICATION REQUIREMENT.

    (a) In General.--An operator of a regulated pornographic Web site 
shall verify that any user attempting to access their site is 18 years 
of age or older using software certified for that purpose by the 
Commission.
    (b) Requirement.--The age verification required by this section 
shall take place prior to the display of any pornographic material, 
including free content that may be available prior to the purchase of a 
subscription or product.

SEC. 102. CREDIT CARD REQUIREMENT.

    A bank, credit card company, third-party merchant, Internet payment 
service provider, or business that performs financial transactions for 
a regulated pornographic Web site shall only process age-verified 
Internet pornography credit card transactions for sales carried out in 
accordance with this title.

SEC. 103. COMMISSION REQUIREMENT.

    The Commission shall--
            (1) require each regulated pornographic Web site to--
                    (A) use appropriate age-screening software to carry 
                out this title; and
                    (B) use that software correctly and consistently 
                through such means as conducting periodic tests trying 
                to access the Web site without appropriate age 
                verifications; and
            (2) in coordination with the Department of Justice and 
        other Federal agencies, maintain a list of regulated 
        pornographic Web sites that are not in compliance with section 
        101.

SEC. 104. ENFORCEMENT BY THE FEDERAL TRADE COMMISSION.

    (a) Unfair or Deceptive Acts or Practices.--A violation of section 
101 shall be treated as a violation of section 18 of the Federal Trade 
Commission Act (15 U.S.C. 57a) regarding unfair or deceptive acts or 
practices.
    (b) Powers of Commission.--The Commission shall issue and enforce 
the regulations for the enforcement of section 101 in the same manner, 
by the same means, and with the same jurisdiction, powers, and duties 
as though all applicable terms and provisions of the Federal Trade 
Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a 
part of this title. Any person who violates such regulations shall be 
subject to the penalties provided in that title.

SEC. 105. DEFINITIONS.

    In this title:
            (1) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (2) Regulated pornographic web site.--The term ``regulated 
        pornographic Web site'' means a person required to maintain 
        documents verifying the age of persons engaged in sexually 
        explicit conduct pursuant to section 2257(a) of title 18, 
        United States Code.

                 TITLE II--FUNDING FOR CHILD PROTECTION

                         Subtitle A--Excise Tax

SEC. 201. EXCISE TAX ON INTERNET DISPLAY OR DISTRIBUTION OF 
              PORNOGRAPHY.

    (a) In General.--Chapter 33 of the Internal Revenue Code of 1986 
(relating to facilities and services) is amended by inserting after 
subchapter C the following new subchapter:

    ``Subchapter D--Internet Display or Distribution of Pornography

        ``Sec. 4285. Internet display or distribution of pornography.

``SEC. 4285. INTERNET DISPLAY OR DISTRIBUTION OF PORNOGRAPHY.

    ``(a) Imposition of Tax.--There is imposed on amounts charged by a 
regulated pornographic Web site for individuals to receive the display 
or distribution of pornography through the Internet a tax equal to 25 
percent of the amounts so charged.
    ``(b) Payment of Tax.--The tax imposed by this section shall be 
paid by the operator of the regulated pornographic Web site receiving 
payment for the display or distribution taxed under subsection (a).
    ``(c) Definitions.--In this section:
            ``(1) Pornography.--The term `pornography' has the same 
        meaning as defined in section 2256(2) of title 18, United 
        States Code.
            ``(2) Regulated pornographic web site.--The term `regulated 
        pornographic Web site' has the same meaning as defined in 
        section 105 of the Internet Safety and Child Protection Act of 
        2005.''.
    (b) Conforming Amendment.--The table of subchapters for chapter 33 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new item:
   ``subchapter d--internet display or distribution of pornography''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2006.

                 Subtitle B--Child Protection Programs

SEC. 211. TRUST FUND.

    (a) In General.--There is established in the Treasury the Internet 
Safety and Child Protection Trust Fund (referred to in this subtitle as 
the ``trust fund'') into which shall be deposited all taxes collected 
under section 4285 of the Internal Revenue Code of 1986.
    (b) Availability of Amounts.--Amounts deposited into the trust fund 
shall be available to carry out the programs provided in section 212, 
subject to annual appropriations.

SEC. 212. FUNDING FOR CHILD INTERNET SAFETY AND PROTECTION PROGRAMS.

    (a) Priorities.--Amounts available in the trust fund shall be 
allocated on a priority basis as follows:
            (1) Enforcement of this act.--The first priority for the 
        use of amounts in the trust fund shall be to provide funding 
        for the appropriate Federal agencies to carry out the 
        enforcement of sections 103, 104, and 201 of this Act. Funding 
        may also be used to promote the development of technology that 
        would facilitate the enforcement of this Act.
            (2) Department of justice cyber tip-line.--The second 
        priority for the use of amounts in the trust fund shall be to 
        provide funds to the Office of Juvenile Justice and Delinquency 
        Prevention to ensure that the congressionally-mandated cyber 
        tip line is fully operational and staffed 24 hours a day.
            (3) Internet crimes against children task force.--The third 
        priority for the use of amounts in the trust fund shall be to 
        provide funds to States to support 1 Internet Crimes Against 
        Children Task Force center per 5,000,000 State residents, with 
        each State receiving sufficient funding to support at least 1 
        center and no State receiving funding for more than 7 centers.
            (4) Research and development grants.--
                    (A) In general.--The fourth priority for the use of 
                amounts in the trust fund is to establish a competitive 
                grant process for companies and other organizations who 
                work in the technology field to support the research 
                and development into new filtering technologies that 
                will help parents control children's access to 
                inappropriate content via wireless and other emerging 
                technologies.
                    (B) Set aside.--The Attorney General shall allocate 
                up to 10 percent of annual trust fund revenues to award 
                a minimum of 15 research and development grants under 
                this paragraph.
            (5) Educational training.--
                    (A) In general.--The fifth priority for the use of 
                amounts in the trust fund shall be to provide relevant 
                State agencies with funds to support educational 
                training contributing to greater child Internet safety 
                and reductions in sex trafficking and sex crimes 
                against children.
                    (B) Conditions.--The program authorized by this 
                paragraph shall be carried out subject to the following 
                conditions:
                            (i) States shall receive funding amounting 
                        to $1 for every resident, with a minimum of 
                        $1,000,000 for each State.
                            (ii) 25 percent of each State's funding 
                        shall go to the State education agency to 
                        support State and local programs providing 
                        child Internet safety training to teachers.
                            (iii) 30 percent of each State's funding 
                        shall go to the State Attorneys' General office 
                        to support child Internet safety training for 
                        law enforcement, as well as training that 
                        enhances the capacity of law enforcement to 
                        combat sex trafficking and sex crimes against 
                        children.
                            (iv) 10 percent of each State's funding 
                        shall be allocated to the Governor's office to 
                        develop and implement a coordinated State child 
                        internet safety strategy.
                            (v) 35 percent of the State funding shall 
                        go to the relevant State agency to support 
                        Public Service Announcements promoting child 
                        Internet safety.
            (6) Remaining amounts.--After fully funding the priorities 
        established in paragraphs (1) through (5) for a fiscal year any 
        remaining amounts shall be allocated as follows:
                    (A) Federal agency support.--50 percent of 
                remaining amounts shall be used to provide funding to 
                support child Internet safety activities, as well as 
                activities combating sex trafficking and sex crimes 
                against children, on the part of the following Federal 
                Agencies:
                            (i) Department of Justice.
                            (ii) Department of Commerce.
                            (iii) Department of Defense.
                            (iv) Department of Education.
                            (v) Department of Health and Human 
                        Services.
                            (vi) Department of State.
                            (vii) Department of Homeland Security.
                            (viii) Department of the Treasury.
                            (ix) Department of Agriculture.
                            (x) United States Postal Service.
                            (xi) Federal Trade Commission.
                            (xii) Federal Communications Commission.
                            (xiii) National Aeronautics and Space 
                        Administration.
                    (B) Private entities.--
                            (i) In general.--50 percent of remaining 
                        amounts shall be allocated through a 
                        competitive grant process to international and 
                        domestic nongovernmental organizations and not-
                        for profits, to support work promoting child 
                        Internet safety and combating sex trafficking 
                        and sex crimes against children.
                            (ii) Details.--The Attorney General shall--
                                    (I) publish guidance in the Federal 
                                Register describing the variety and 
                                scope of organizational work to be 
                                funded under this subparagraph in a 
                                fiscal year and soliciting grant 
                                proposals under this subparagraph; and
                                    (II) allocate funds on the basis of 
                                a competitive grant process.
                            (iii) Funding limit.--For every $1 
                        allocated for international work under this 
                        subparagraph, the Attorney General shall 
                        allocate $2.5 dollars for domestic work.
    (b) Grant Programs.--
            (1) In general.--The Attorney General shall carry out this 
        section.
            (2) Terms and conditions.--The Attorney General shall 
        prescribe the terms and conditions for grant applications and 
        awards under this section.

SEC. 213. DEFICIT REDUCTION.

    Amounts remaining in the trust fund after the programs authorized 
in section 212 are funded shall be returned to the Treasury and applied 
to deficit reduction.

Summary: Internet Safety and Child Protection Act of 2005 - Requires: (1) an operator of a regulated pornographic website to verify (using Federal Trade Commission (FTC)-certified software) that any user attempting to access its site is age 18 or older; (2) a bank, credit card company, third-party merchant, Internet payment service provider, or business that performs financial transactions for such a website to only process age-verified Internet pornography credit card transactions; (3) the FTC to require use of appropriate age-screening software and maintain a list of websites that do not comply; and (4) violations of the age verification requirement to be treated as a Federal Trade Commission Act violation.

Amends the Internal Revenue Code to impose upon the operator of a regulated pornographic website for any Internet pornography display or distribution a tax equal to 25 percent of the amounts charged.

Establishes in the Treasury the Internet Safety and Child Protection Trust Fund into which such taxes shall be deposited. Requires Fund amounts to be allocated (in order of priority) for: (1) federal agencies to enforce this Act; (2) the Office of Juvenile Justice and Delinquency Prevention to ensure that the cyber tip line is fully operational and staffed 24 hours a day; (3) states to support Internet Crimes Against Children Task Forces; (4) companies to support research and development into new filtering technologies; (5) state agencies to support educational training; and (6) specified federal agencies, nongovernmental organizations, and nonprofits to support child Internet safety activities, including combating sex trafficking and sex crimes against children.