Massachusetts Lawmakers Eye a ‘Netflix Tax’ To Fund Community TV Channels
A proposed state tax in Massachusetts on streaming video services could increase prices for popular platforms like Netflix and Hulu, as the 5 percent fee would support approximately 200 community access cable channels struggling due to declining cable subscriptions. The Boston Globe reports: In July, the Joint Committee on Advanced Information Technology held hearings on legislation filed by Democratic State Representative Joan Meschino and Republican Representative Mathew J. Muratore, both of Plymouth. Their bill would require streaming video companies to pay a 5 percent fee on the gross revenues generated in the state. The estimated $65 million a year raised by the fee would support roughly 200 community access channels, the most in any state. The community channels are run by nonprofit organizations or town governments, and funded by cable TV companies, which are assessed a fee by local governments for the right to run their cables through city property. The cable companies pass the cost on to subscribers.
But subscriptions are plummeting as US consumers abandon pay TV for streaming services. Cable and satellite subscribers now number about 70 million, down more than 25 percent from 95.5 million a decade ago, according to Leichtman Research Group, a New Hampshire research and analysis company specializing in media, entertainment, and broadband industries. “The next three to five years it’s really going to dry up even more so,” said Muratore. Meschino said citizens can’t afford to lose access to community media channels, because so many local newspapers have shut down. “There’s literally no other way to consume that sort of hyperlocal programming,” Meschino said.
About a dozen US states levy sales taxes on consumers’ streaming video bills. But Meschino said that sales tax money goes into each state’s general fund. Instead, she wants the streaming fee to be dedicated entirely to support for community media services, just like the fee paid by traditional cable TV companies. Some or all of the fees would likely be passed on to consumers. Gauthier estimates that a typical household’s costs could rise about $2.40 a month, spread among several streaming networks. “Maybe it’ll be 75 cents for your Amazon,” he said. “Maybe it’ll be 80 cents for your Disney.”
Read more of this story at Slashdot.
A proposed state tax in Massachusetts on streaming video services could increase prices for popular platforms like Netflix and Hulu, as the 5 percent fee would support approximately 200 community access cable channels struggling due to declining cable subscriptions. The Boston Globe reports: In July, the Joint Committee on Advanced Information Technology held hearings on legislation filed by Democratic State Representative Joan Meschino and Republican Representative Mathew J. Muratore, both of Plymouth. Their bill would require streaming video companies to pay a 5 percent fee on the gross revenues generated in the state. The estimated $65 million a year raised by the fee would support roughly 200 community access channels, the most in any state. The community channels are run by nonprofit organizations or town governments, and funded by cable TV companies, which are assessed a fee by local governments for the right to run their cables through city property. The cable companies pass the cost on to subscribers.
But subscriptions are plummeting as US consumers abandon pay TV for streaming services. Cable and satellite subscribers now number about 70 million, down more than 25 percent from 95.5 million a decade ago, according to Leichtman Research Group, a New Hampshire research and analysis company specializing in media, entertainment, and broadband industries. “The next three to five years it’s really going to dry up even more so,” said Muratore. Meschino said citizens can’t afford to lose access to community media channels, because so many local newspapers have shut down. “There’s literally no other way to consume that sort of hyperlocal programming,” Meschino said.
About a dozen US states levy sales taxes on consumers’ streaming video bills. But Meschino said that sales tax money goes into each state’s general fund. Instead, she wants the streaming fee to be dedicated entirely to support for community media services, just like the fee paid by traditional cable TV companies. Some or all of the fees would likely be passed on to consumers. Gauthier estimates that a typical household’s costs could rise about $2.40 a month, spread among several streaming networks. “Maybe it’ll be 75 cents for your Amazon,” he said. “Maybe it’ll be 80 cents for your Disney.”
Read more of this story at Slashdot.