Official works for reduced TV tax

Consumers eventually could save $3 to $6 a month if a lawmaker is successful in phasing out a tax on cable and satellite TV.

By ANITA KUMAR, Times Staff Writer
© St. Petersburg Times
published February 23, 2002

TALLAHASSEE -- While the state Legislature remains deadlocked over a Senate plan to wipe out dozens of sales tax exemptions, the next House speaker wants to create a new one for cable and satellite customers.

Consumers would save about $3 to $6 a month at a cost of $180-million in state revenue over eight years.

The bill, sponsored by Rep. Johnnie Byrd, R-Plant City, calls for the tax to be phased out over the next eight years to soften the impact on the already shaky state budget. It would be effective July 1.

The move is inspired partly by confusion over changes in the tax last year, Byrd said. But it also is a political statement.

"This sends a message to residents that, indeed, Republicans ran on a platform of less taxes," said Byrd, who will become the next speaker in November if the Republicans retain control of the House. "It goes back to your vision of government."

The proposal eliminates the 6.8 percent sales tax for customers of residential cable and direct-to-home satellite service. Still, some taxes on TV service would remain.

Cable TV customers would pay 2.37 percent and satellite TV customers would pay 6.37 percent in other taxes, such as one that funds school construction. That's about $1 to $2.50 on the average monthly bill.

The bill passed the House Utilities and Telecommunications Committee this week on a 9-2 vote with no debate. Two Democrats opposed the bill.

"That's a whole lot of money out of the state revenue stream," said Rep. Mark Weissman, D-Parkland. "It's not the state that winds up losing, it's the people -- kids, seniors, the disabled."

Weissman and Rep. Gary Siplin, D-Orlando, said they could not support a tax break when the Legislature slashed $1-billion in spending after Sept. 11 and face another financial crunch this year.

If the bill passed, state and local governments would collect $18.2-million less the first year and $39.2-million less the second year. They would be out $180-million the first eight years, said Rep. Mike Fasano, R-New Port Richey, a co-sponsor of Byrd's bill.

"How can I sit here and do another exemption while people are almost starving?" Siplin said. "It doesn't make sense. ... I know he's going to be the next speaker of the House, but I can't support it."

The bill has one more stop before reaching the full House. Sen. Durell Peadon, R-Crestview, is sponsoring a similar Senate measure. His bill proposes creating the exemption immediately, but he plans to amend the bill to match Byrd's eight-year plan.

Byrd and Peadon said they have heard complaints from constituents, particularly those with satellite TVs in rural areas, about high costs.

Most arose after the Legislature passed last year's Communication Services Tax Simplification Law, which raised some taxes and lowered others.

In October, the state implemented a new tax system that consolidated communications taxes. Byrd said people realized then just how much they were paying for TV service.

Once the entire tax is removed, the average Time Warner customer, who pays $40 a month for cable, would save about $2.70. Those who subscribe to movie channels, who pay up to $90 a month, would save just more than $6.

"We're supportive of it because customers' bills would go down considerably," said Charles Dudley, general counsel for the Florida Cable Telecommunications Association. "Communications taxes are too high in this state."

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