Cable companies back new tax on satellite TV

Customers of satellite television systems may soon see a tax hike in their bills.

The state's main cable providers, perturbed that they pay franchise fees but their competitors don't, are backing a bill to put a 5 percent tax on gross receipts collected by pay television providers.

Because the bill would exempt companies that pay franchise fees already, it would apply mostly to satellite television providers.

About 187,000 people in Nevada use satellite services, company representatives said.

The tax outlined in AB151 would yield an estimated $5.3 million a year that would go into a trust fund to buy new communications systems for first responders.

The Assembly Commerce and Labor Committee is reviewing the bill.

Cox Communications Vice President Steve Schorr said his company is feeling the pinch of the satellite television companies.

He pointed out that traditional Nevada cable companies paid almost $14 million in fees last year.

"There's no doubt we're trying to level the playing field," Schorr said. "It's a competitive market."

Satellite companies say that cable companies are paying for the right-of-ways on city streets, just as utility companies do.

They argued that targeting a new tax on one industry is a bad tax policy.

"The bottom line is that cable hasn't had to compete and now they're having to compete," said Eric Sahl, a vice president with EchoStar Communications. "They don't want to compete fairly and they want to charge us a tax.