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Satellite TV sues to end taxes

Satellite television providers say the taxes that seven states levy on their services are unfair. So they're heading to court.

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While they might still snipe at each other in commercials, DirecTV and Dish Network have joined forces in a lawsuit they've filed against Massachusetts.

The two companies contend the 5 percent tax on satellite services they pay in the Bay State is discriminatory because it applies to them and not rival cable TV operators.

Cable TV operators pay franchise fees to municipalities because they need access to public property to lay cable lines. The satellite TV companies say they should be exempt from any such tax because they don't "tear up roads" in getting their programming to customers.

The filing in the Massachusetts state court is just the latest legal action undertaken by satellite TV companies.

A federal bill, H.R. 1019, also is pending in Congress.

The State Video Tax Fairness Act would prohibit any state from imposing a discriminatory tax on any "means of providing multichannel video programming distribution services."

As for the term discriminatory tax, the legislation defines it as one where the net tax imposed on one program provider is higher than what is assessed another.

My favorite part of the lawsuit is the reported statement that the tax on satellite television services prompts some subscribers to switch to cable.

Really? Judging from all the complaining I hear about cable systems, these must be ginormous taxes.

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It is unfair in a sense that the cable operators pay their taxes while those who uses satellite pay nothing but still they get lots of channel. But i don't think the satellite users should pay. Lets find out what would be the decision on the case.

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