Senate kills television service equalization bill

SALT LAKE CITY — The Utah Senate killed a bill intended to fix the discrepancy in tax Utahns pay whether they subscribe to a cable or satellite service for television. SB112, sponsored by Sen. Wayne Niederhauser, R-Sandy, died on a vote of 12-16. Satellite subscribers pay a 6.25 percent excise tax to the state—but no local franchise fee. Cable subscribers pay a 3.75 percent excise tax to the state plus a franchise fee to their local government. Some local franchise fees are as high as 6 percent, meaning cable customers total tax would be 9.75 percent.
Sen. Curtis Bramble, R-Provo, said the bill was an attempt to fix an inequity created by Congress.
“This was an industry that sought special congressional protection for a tax benefit,” said Bramble, referring to satellite providers’ exemption from local franchise fees.
But other senators opposed the bill saying local governments should work to level the playing field themselves.
“At the end of the day, why is it the state’s responsibility to solve this local problem?” said Sen. Aaron Osmond, R-South Jordan.
Senate Majority Leader Scott Jenkins, R-Plain City, said the state did not have the funds to cover a $6.7 million tax credit the policy would require.
“We’re literally giving it all up. Is that fair?” he said.