New tax for broadband customers?

CNET News.com ^ | Fri Jul 01 2005 | Anne Broache

[newzjunkey]

Many broadband customers will pay new universal service taxes akin to those on their telephone bills if Congress bows to suggestions from rural legislators...

The USF currently collects a fixed percentage of revenues from long-distance, wireless, pay phone and telephone companies so that it can pass on subsidies to low-income customers, high-cost areas, and rural health care providers, schools and libraries. Most companies come up with their share, set for this quarter at 10.2 percent, by charging their customers a fee.

The USF should continue to be "industry funded," but the base of contributors should be expanded to "all providers of two-way communications, regardless of technology used, to ensure competitive neutrality," a bipartisan coalition of rural legislators said in a June 28 letter to the U.S. House of Representatives Energy and Commerce Committee, which will be drafting the rewrites. That means companies providing broadband services such as VoIP over telephone wires would also have to pay into the fund...

"If our residents are to be competitive in today's fast-paced, technology-driven global marketplace, our communities will require affordable high-speed, high-capacity access to data and information over the Internet," Rep. John Peterson, R-Penn., co-chairman of the Congressional Rural Caucus, said... "If the private sector is either unwilling or unable to provide that service at an affordable price, we'll find a way to provide it for ourselves."

The wireless industry applauded the proposed change "since wireless consumers are significant and disproportionate payers into the universal service and intercarrier compensation systems," Steve Largent, CEO of CTIA - The Wireless Association, said in a statement...

The Universal Service Fund in recent years has faced allegations of waste, fraud and abuse. The FCC announced in June a formal inquiry into its management.

[newzjunkey]

The Steve Largent pushing for this on behalf of the wireless industry is the same as the football player and ex-Congressman (R).

Do we really need these fees, taxes and subsidies?

Does anyone know about this "Rural Caucus" leanings? I never heard of them before and this proposal seems to be flying a bit under the radar.

The House is debating the Telecommunications Act of 1996 which spawned the so-called Universal Service Fund (USF). The USF is under the FCC's control. Sixty-two House members signed the letter, supposedly in a bipartisan fashion.

[endthematrix]

Still paying for the Spanish-American War....

[Kozak]

Anyone who can see the southern sky CAN get broadband now by satellite. No need to suck on the taxpayer tit for this.

[cyborg]

You can only milk the goat so much before you yank the teat right off.

[RandallFlagg]

They'd likely go after satellite as well.

Isn't all internet access and ISP service taxed already?
And, hasn't it occured to these nippleheads that raising taxes cuts revenue (Remember cigarette taxes?)?

[glock rocks]

so that it can pass on subsidies to low-income customers, high-cost areas, and rural health care providers, schools and libraries

From each according to his abilities, to each according to his needs. - Marx

[SoDak]

I'm considering soon taking a three or four month internet vacation, and unplugging my broadband at home and work. This helps the decision a little, based on principle alone.

[varyouga]

Phone taxes are supposedly used to install phones in rural areas where it would otherwise not be cost-effective to run copper.

Broadband certainly did change the way I live and work. A small tax could send broadband to rural areas and increase business in the long term.

Right now most rural areas could only get satellite broadband. It is usually slow, unreliable with bad customer service, and high priced.


But of course I'm thinking of a dream world where people are taxed fairly and taxes are not wasted. It's most likely the phone companies whining about losing customers to on-line phones.

[freepatriot32]

Libertarian ping.To be added or removed from my ping list freepmail me or post a message here

[endthematrix]

FCC's strategic goal for Broadband
http://www.fcc.gov/broadband/

Does the FCC Require That Phone Companies Recover Their Universal Service Contributions From Their Customers?

The FCC does not require companies to recover their contributions directly from their customers. Each company makes a business decision about whether and how to assess customers to recover Universal Service costs.

Although it is not mandatory that companies charge a Universal Service fee to help recover their contributions to the fund, most do. Companies that choose to collect Universal Service fees from their customers cannot collect an amount that exceeds their contribution to the Universal Service Fund.

http://www.fcc.gov/cgb/consumerfacts/usfincrease.html


Congressional Rural Caucus
http://www.house.gov/johnpeterson/ruralcaucus/telecomtaskforce.htm

[Graybeard58]

From each according to his abilities, to each according to his needs. - Marx

And Hillary.

[Flyer]

Remember cigarette taxes?

Hmmmm. . . can I grow my own ISP?

[Recovering_Democrat]

"If our residents are to be competitive in today's fast-paced, technology-driven global marketplace, our communities will require affordable high-speed, high-capacity access to data and information over the Internet," Rep. John Peterson, R-Penn., co-chairman of the Congressional Rural Caucus, said... "If the private sector is either unwilling or unable to provide that service at an affordable price, we'll find a way to provide it for ourselves."

This is horse crap. Anyone ever tell this guy about DirecWay, or some other satellite internet system? At any rate, his constituents' choice of homestead should not infringe upon my pocketbook. I live in the city. I don't get the benefits of living in a rural community. Can I dip into the pockets of the rural citizens to buy some "night sounds of the wilderness" CDs?

[YOUGOTIT]

Destroy the USF. This tax needs to go.

[chuckles]

This is crap anyway! I didn't have DSL till about 6 months ago. All we had to do is get a CLEC to show interest in moving here and "viola", DSL came to East Texas via SBC. Then cable TV offered it also. 10 months ago, if you asked, its not cost effective to bring DSL here. All the sudden, we have competition.I don't see how taxes would have changed anything.

I do admit though, I bet there isn't 150 DSL lines in my 2800 county. Not much room for profit. The cable company bills you for how many megabits you recieve, what a crock.

[Dallas59]

I'm getting to that point also.

[endthematrix]

"If the private sector is either unwilling or unable to provide that service at an affordable price, we'll find a way to provide it for ourselves."

Ah, wielding government legitimacy through extortion and theft.

[demlosers]

We don't need another stink'n tax - them Assbites.

[endthematrix]

Advocacy for local rights

http://www.telecommunityalliance.org/mission.html

[RandallFlagg]

Hmmmm. . . can I grow my own ISP?

Well, I think you know what I was talking about there: the consumer creates a greater demand for a product that the government sees as profitable to their pockets through more taxation.
But as far as looking at your statement with a series eye, why not? Growing your own tobacco to save cost should be no different than starting your own ISP. Price would be a lot different: launching the satellite, running the wiring to the service, fullfilling all state and federal requirements and regulatonary responsibilities to proceed, etc.