COMMENTS OF SBCA PRESIDENT ANDREW WRIGHT IN RESPONSE TO TESTIMONY BY OHIO TAX COMMISSIONER TOM ZAINO
ALEXANDRIA, VA, June 11, 2003 – For attribution to Andrew Wright, President of the Satellite Broadcasting and Communications Association, in response to today's comments by Ohio Tax Commissioner Tom Zaino before the state Conference Committee.
We agree wholehearted with today's testimony by Ohio Tax Commissioner Tom Zaino that a constitutional challenge to a satellite-only tax in the state "has a significant chance of success."
Our view is and has always been that legally, a state may apply its sales tax to both cable and satellite, or to neither. This position was validated recently by two respected law firms--Steptoe & Johnson (in Washington, DC) and Calfee, Halter & Griswold (in Cleveland, Ohio) that analyzed the constitutionality of the proposed legislation on behalf of DIRECTV, Inc and EchoStar. We prefer that Ohio tax neither cable nor satellite subscribers, but we recognize that legislators and the Governor will make that determination.
For those concerned about the fiscal health of Ohio, taxing only satellite customers makes no sense. It punishes one set of pay-TV consumers over another, and because of the strong constitutional issues, it is unlikely to generate revenue in the short or long term.
On behalf of the nation's satellite industry, the thousands of Ohio retailers who sell satellite service, and Ohio's 678,000 satellite consumers, we urge the state's legislators and Governor to eliminate the tax on satellite in the current budget bill.
The Satellite Broadcasting and Communications Association (www.sbca.com) is the national trade organization representing all segments of the satellite industry. It is committed to expanding the utilization of satellite technology for the broadcast delivery of video, audio, data, music, voice, interactive and broadband services. The SBCA is composed of DBS, C-band, broadband, satellite radio, and other satellite service and launch vehicle providers, content providers, equipment manufacturers, distributors, retailers, encryption vendors, and national and regional distribution companies that make up the satellite services industry.