Dear Legislator:
On behalf of the National Taxpayers Union's 52,300 members in California, I urge you to oppose a new 5-8 percent tax on satellite television. This tax is a punitive levy on satellite television customers only, which will increase costs for many households, limit entertainment choices for consumers, and do little to solve California's chronic budget crisis.
A tax on satellite television would punish 3.6 million Californians simply for choosing satellite over cable or broadcast television. Politicians should not be in the business of making personal decisions for consumers, especially by dictating such choices due to higher taxes. Satellite television is often the only option for Californians who live in the rural parts of the state where cable and broadcast is not available. Additionally, satellite is often the only medium for the various programming options – from sports to news – that consumers enjoy.
Some argue that this new tax is warranted in order to "level the playing field" because the cable television industry has paid "franchise fees" in exchange for public rights-of-way to lay cable. But this is a cost of doing business, and one mirrored by satellite providers' need to competitively bid for the use of federally owned spectrum over which they can transmit their signals. Satellite providers must also pay hundreds of millions in preparing, launching, and maintaining their spacecraft as a precondition of getting their service into homes and businesses. In any case, if cable providers believe they are paying too much to local governments, the answer is to seek lower taxes on their own operations, not to plead for the Legislature to impose higher taxes on their competitors under a twisted definition of "fairness."
There is no question that California has major budget troubles. The state faces a deficit of at least $20 billion. But California does not have a revenue problem; it has a spending problem. California's tax rates – for the personal income tax, the corporate tax, the sales tax, and the gas tax – are among the highest in the country. State spending has more than doubled in nominal terms (not adjusted for inflation) over the last decade, and has risen almost 40 percent during the current administration's tenure, according to Sunshine Review. California needs to overhaul its tax code and reduce spending, not find ways to increase the burden on the state's taxpayers who are already struggling in this economy.
California faces serious problems and needs to undertake equally serious reforms. It does not need to add to the complicated tax burden by imposing a new tax on satellite television. Therefore, our members hope you will reject any proposal to do so.
Sincerely,
John Stephenson
State Government Affairs Manager