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Satellite-TV sales tax proposal runs out of time

With the state legislative session heading into its last week, an effort backed by cable firms to impose a 5% levy on their competitors may be put off until next year or beyond.

September 05, 2009|Marc Lifsher

SACRAMENTO — A last-minute attempt by cable television companies to impose a 5% sales tax on their satellite TV competitors ran out of time Friday as the 2009 legislative session headed into its last week.

Cable companies, which pay a 5% franchise fee to local governments for the right to run their lines on public property, said it would be fair to slap the same levy on satellite operators, such as DirecTV Group Inc. and Dish Network Corp.

State Sen. Roderick Wright (D-Inglewood), who was expected to carry a satellite tax bill, signaled that he would postpone the effort until at least next year. Wright missed a Friday deadline for amending a bill that would include the proposed tax. His staff members and lobbyists on both sides of the issue had indicated earlier in the week that the bill's chances this year were diminishing in the final days of the session.

A representative of the California Cable and Telecommunications Assn. could not be reached for comment. The industry has been arguing in California and other states that there should be a competitive "level playing field" for them and the satellite TV business.

Representatives of the satellite industry said they were preparing for a major fight in 2010 over the proposed $170-million annual tax on 3.6 million satellite users.

"Satellite companies do not pay franchise fees for one simple reason," said DirecTV Chief Executive Larry D. Hunter. "Satellite uses innovative technology that does not disrupt the public rights of way."

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marc.lifsher@latimes.com

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