Monday, February 02, 2009

Ordinance to Illegally Tax Satellite Customers Repealed

The revenue package we told you about last year - the one that would force DirecTV and Dish Network to collect a tax and remit it to the city or divulge customer names, addresses and phone numbers to the City of Chicago - has been repealed. According to Fran Speilman* of the Chicago Sun Times:

"Daley quietly introduced a repeal this past week of the ordinance tied to his 2009 budget requiring satellite customers to pay the 9 percent amusement tax that applies to monthly cable TV bills.

To get around a federal law that appears to ban cities from taxing direct-broadcast satellite services, Daley wanted to require DirecTV and Dish Network to give the city's Revenue Department the name, address and phone number of all of their Chicago subscribers so the city could do the billing."
[. . .]
But, after meeting with satellite industry attorneys, the Daley administration now says that the proposed end-run was illegal.

"They can't give us the information the ordinance requires them to give us without violating federal law," said Law Department spokeswoman Jennifer Hoyle.

There's more detail on this failed attempt to end-run two federal laws in Fran Spielman's report. Frankly, I'm stunned at the admission that federal law applies in Chicago, and had predicted they would do it anyway. Happily, I was wrong.

(*Fran Spielman is a favorite around here. Here's a link to her recent work. )

1 comment:

Not Wired said...

Since the expected revenue from this tax was never figured in to the Daley's budget, there must have been some sense this thing wouldn't fly. I can't help but wonder if money to pay his lawyers to bypass federal law was budgeted. What else are we paying for quietly?? There's a lot of silence from City Hall when Da Mayor loses.

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