Support Fair Taxation in the Video Marketplace
Reject the NEW 11% Tax on Satellite Television

There could not be a worse time to raise taxes on Satellite TV.

• With budgets already stretched to their limits, this is one tax that consumers cannot afford. For most of us, TV is our primary source of information on everything from the local news and weather to national politics, and it is also our entertainment of last resort.
• This tax will force the over one hundred thousand Satellite TV subscribers in the State to make an impossible choice: pay a tax they cannot afford or lose a service they cannot afford to lose.
• This tax will unfairly hurt the majority of Vermonters living in rural parts of the State where broadcast signals just don’t go. Just to see the nightly news, these families must subscribe to a pay TV service. This tax punishes them for living where they do.
• Thousands of senior citizens in Vermont who are on a fixed income and use satellite as a lifeline to the rest of the world will be hurt by an additional $60 a year on their bills.
• The hotel, bar, and restaurant owners in Vermont who need satellite TV service just to stay in business will feel this additional 5% increase in their TV costs on top of the 6% they already pay the state for television.

Local access fees are NOT taxes. Cable claims that Satellite’s exemption from paying these fees justifies the proposed discriminatory tax is simply flat out wrong.

• Cable pays certain fees as part of their agreements to get the access rights they need to dig up public streets and sidewalks so that they can lay cables and provide service in a specified area.
• Cable companies only call these fees taxes when it’s convenient—but, they readily admit that the fees are a cost of doing business when speaking to investors and litigating against local governments.
• The Satellite companies do not pay local access fees for one simple reason: They do not use nor need access to the public rights-of-way. But, while they have no cables to lay, they have their own costs of doing business—building, launching, and maintaining satellites in outer space. The difference? Satellite does not break these costs out on consumer’s bills and call them taxes.
• Simply put, local access fees are an inherent cost of doing business for cable—they are NOT taxes.

But the impact of this discriminatory scheme would not end there—every citizen would feel the inevitable effects that accompany reduced competition.

• By effectively only imposing the new tax on satellite TV, the State would be tilting the playing field in cable’s favor and stifling competition in the video market place.
• Competition brings lower prices, higher quality and better service. But, when the State discriminates, competition suffers, service gets worse, quality goes down, and prices go up.
• The bottom line for cable customers: Cable has no incentive to reduce prices, improve service and quality, or offer more programming. Indeed, the only real beneficiaries of the proposed discriminatory tax credit are the cable companies themselves.

The Satellite-only tax violates the Constitution of the United States.

• From a fiscal perspective, worst of all is the fact the proposed scheme is plainly illegal. It violates the Constitution of the United States by discriminating against interstate commerce. States have been prohibited from enacting such measures since the nation was born, and they are still prohibited today.
• If enacted, this tax will be challenged and it will be struck down and the revenue generated will be returned. As a result, no revenue generated from this tax is safe.