Steve Mehs
02-07-03, 05:18 AM
Two states are considering taxing cable and satellite TV services in an effort to reverse budget shortfalls, and the proposals have led organizations representing the two services to fight the proposals.
In Kentucky, Gov. Paul Patton is considering higher taxes on cable and satellite TV to help overcome a $400 million deficit in the state budget. The proposed changes in Kentucky's telecommunications tax laws would place a 9 percent tax on satellite TV services and a 6 percent tax on cable subscriptions.
Andy Wright, president of the Satellite Broadcasting and Communications Association, wrote Patton about the proposed tax, saying it's unfair and anticompetitive to Kentucky consumers who receive satellite TV. He said the proposed tax "would discriminate in favor of cable and other telecommunications providers to the detriment of the competing DBS services" since small dish services don't enjoy a local monopoly like cable and don't use local rights-of-way or services.
"High taxes placed on telecommunications services reduce consumer choice and put many advanced services out of reach for many consumers," Wright said. "Excessive taxes can also limit the development and introduction of new and improved technologies."
In Ohio, Gov. Bob Taft has proposed a 5 percent tax on satellite TV and cable services offered in the state, a charge that could be extended to pay-per-view, equipment rentals, service call charges and installation.
The Ohio tax plan got resistance from the Ohio Cable Telecommunications Association and its executive vice president, Ed Kozelek.
"We understand the challenge our General Assembly faces to balance the state budget, but imposing a duplicative tax on cable customers is not the answer. Our customers already pay tax on their cable service at the local level in the form of a franchise fee," Kozelek said. "Cable customers pay up to five percent in fees to local governments, and the sales tax would essentially double the tax for those customers."
From SkyReport (http://www.skyreport.com/skyreport/feb2003/020703.shtm#one) (Used with Permission)
In Kentucky, Gov. Paul Patton is considering higher taxes on cable and satellite TV to help overcome a $400 million deficit in the state budget. The proposed changes in Kentucky's telecommunications tax laws would place a 9 percent tax on satellite TV services and a 6 percent tax on cable subscriptions.
Andy Wright, president of the Satellite Broadcasting and Communications Association, wrote Patton about the proposed tax, saying it's unfair and anticompetitive to Kentucky consumers who receive satellite TV. He said the proposed tax "would discriminate in favor of cable and other telecommunications providers to the detriment of the competing DBS services" since small dish services don't enjoy a local monopoly like cable and don't use local rights-of-way or services.
"High taxes placed on telecommunications services reduce consumer choice and put many advanced services out of reach for many consumers," Wright said. "Excessive taxes can also limit the development and introduction of new and improved technologies."
In Ohio, Gov. Bob Taft has proposed a 5 percent tax on satellite TV and cable services offered in the state, a charge that could be extended to pay-per-view, equipment rentals, service call charges and installation.
The Ohio tax plan got resistance from the Ohio Cable Telecommunications Association and its executive vice president, Ed Kozelek.
"We understand the challenge our General Assembly faces to balance the state budget, but imposing a duplicative tax on cable customers is not the answer. Our customers already pay tax on their cable service at the local level in the form of a franchise fee," Kozelek said. "Cable customers pay up to five percent in fees to local governments, and the sales tax would essentially double the tax for those customers."
From SkyReport (http://www.skyreport.com/skyreport/feb2003/020703.shtm#one) (Used with Permission)