Last month, our satellite television provider announced a significant price increase that approached 10 percent. The wife and I weighed our options and dropped our subscription package down a notch to the least expensive one available. Versus the plan we were in, the new one will save us $30 a month. That’s $30 that we can spend on our toddling daughter’s ever-growing appetite and wardrobe.
Or, so we thought.
Or, so we thought.
Our $30 might be shrinking.
Within 2 weeks of our decision, we got word that Albany, courtesy of Senator Kevin Parker (D-Brooklyn), was pondering the addition of an excise tax on direct broadcast satellite services. This would not be limited to television; it would also include internet and games -- in essence, all products provided to customers from the likes of Dish Network and Direct TV.
This new tax isn’t trivial. At 5 percent, it adds up in a hurry. The average monthly pay-TV bill is $86, a number that the NPD Group (a market research firm) figures will reach $200 per household by 2020. So, if the tax were to go into effect today, you’d be paying an extra $52 per year to state coffers. 7 years down the road, you’d be paying Albany $120 annually just to watch TV.
The reason behind this proposed fee can cause one to believe that Senator Parker must have some friends in the cable industry. He states this surcharge is needed to level the playing field by forcing satellite companies (in reality, their customers) to pay a government-specific fee commensurate with that levied against cable companies. Since the dawn of pay-TV, cable bills have been saddled with a tax approaching 5 percent. In the case of cable, this actually makes sense. The tax in question is a franchise fee through which the cable companies compensate the host communities for use of public land, rights-of-way and public infrastructure.
Satellite companies shouldn’t see a similar fee because they don’t require any of those things – the homeowner is the only one entered in a contract with the company and it’s solely the homeowner’s property (not public property) being used. It should also be noted that satellite providers already pay a franchise fee of sorts (albeit to Washington) because they transmit over a radio spectrum that is managed by -- and allegedly owned by -- the federal government. That’s something that cable companies don’t pay.
Parker’s bill is just another battle in a frustrating, long war.
In the case of my family, we made a concerted effort to save ourselves a pretty penny by choosing to do without some of our favorite channels, only to see a nice chunk of our savings potentially skimmed away by the government. This is nothing new to any of us: Think back to the darkest days of the recession, a time when households across the state made numerous cuts in their budgets in an effort to keep up with job losses or diminished hours at work -- those savings were totally negated by school/property taxes that went up like clockwork and the addition of $1.3 billion in new taxes and fees instituted by the state to cover their own budget problems.
And people wonder why it seems like we New Yorkers can never get ahead…it always one step forward and one step, if not many more, back.
Gasport resident Bob Confer also writes for the New American magazine at TheNewAmerican.com. Follow him on Twitter @bobconfer
This column originally appeared in the 25 March 2013 Greater Niagara Newspapers