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Weren't tax break and incentives given to American telecom firms to solve the problem you described here? I remember it being couched more in terms of far flun

Weren't tax break and incentives given to American telecom firms to solve the problem you described here? I remember it being couched more in terms of far flung houses in rural america than poor suburbs, so I could be mixing things up.

rayiner 10y ago
Some,[1] but by and large the opposite is true: they pay extra taxes. The primary "subsidy" for rural deployment comes from a special 18% tax on telecommunications services. Additionally, there is typically a 5% gross revenue tax that goes to the municipality. Telcos are expected to pay for building out to lower income neighborhoods in urban or suburban areas through cross subsidies (everyone pays the same price even though customers in neighborhoods with high uptake ratios cost much less to connect than customers in neighborhoods with low uptake ratios). [1] There is a "$200 billion" number floating around that's completely false.
- pseudalopex 10y ago
  The only source I've found for 18% is a report from the Tax Foundation.[1] That includes all federal, state, and local taxes and fees. Do you have a source for your numbers? [1] https://files.taxfoundation.org/legacy/docs/Record%20High%20Taxes%20and%20Fees%20on%20Wireless%20Consumers%20in%202015%20[FINAL]_0.pdf https://files.taxfoundation.org/legacy/docs/Record%20High%20...
  - rayiner 10y ago
    https://en.wikipedia.org/wiki/Universal_Service_Fund https://en.wikipedia.org/wiki/Universal_Service_Fund. The 18% rate is paid on some part of the total bill that the FCC deems to be related to interstate voice, with additional state USF fees paid on intrastate services. Historically, telcos didn't pay money into the USF for broadband (except to the extent they're offering telephone service over it), but historically they also couldn't get money out of it for broadband. Under Obama the USF started conversion into a broadband fund, and USF taxes on broadband will likely follow.

rayiner 10y ago

Some,[1] but by and large the opposite is true: they pay extra taxes. The primary "subsidy" for rural deployment comes from a special 18% tax on telecommunications services. Additionally, there is typically a 5% gross revenue tax that goes to the municipality. Telcos are expected to pay for building out to lower income neighborhoods in urban or suburban areas through cross subsidies (everyone pays the same price even though customers in neighborhoods with high uptake ratios cost much less to connect than customers in neighborhoods with low uptake ratios). [1] There is a "$200 billion" number floating around that's completely false.

pseudalopex 10y ago
The only source I've found for 18% is a report from the Tax Foundation.[1] That includes all federal, state, and local taxes and fees. Do you have a source for your numbers? [1] https://files.taxfoundation.org/legacy/docs/Record%20High%20Taxes%20and%20Fees%20on%20Wireless%20Consumers%20in%202015%20[FINAL]_0.pdf https://files.taxfoundation.org/legacy/docs/Record%20High%20...
- rayiner 10y ago
  https://en.wikipedia.org/wiki/Universal_Service_Fund https://en.wikipedia.org/wiki/Universal_Service_Fund. The 18% rate is paid on some part of the total bill that the FCC deems to be related to interstate voice, with additional state USF fees paid on intrastate services. Historically, telcos didn't pay money into the USF for broadband (except to the extent they're offering telephone service over it), but historically they also couldn't get money out of it for broadband. Under Obama the USF started conversion into a broadband fund, and USF taxes on broadband will likely follow.