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The Almighty Buck AT&T Businesses The Internet

FCC Panel Wants To Tax Internet-Using Businesses, Give the Money To ISPs (arstechnica.com) 243

The FCC's Broadband Deployment Advisory Committee (BDAC), which includes members like AT&T, Comcast, Google Fiber, Sprint, and other ISPs and industry representatives, is proposing a tax on websites to pay for rural broadband. Ars Technica reports: If adopted by states, the recommended tax would apply to subscription-based retail services that require Internet access, such as Netflix, and to advertising-supported services that use the Internet, such as Google and Facebook. The tax would also apply to any small- or medium-sized business that charges subscription fees for online services or uses online advertising. The tax would also apply to any provider of broadband access, such as cable or wireless operators. The collected money would go into state rural broadband deployment funds that would help bring faster Internet access to sparsely populated areas. Similar universal service fees are already assessed on landline phone service and mobile phone service nationwide. Those phone fees contribute to federal programs such as the FCC's Connect America Fund, which pays AT&T and other carriers to deploy broadband in rural areas.

The BDAC tax proposal is part of a "State Model Code for Accelerating Broadband Infrastructure Deployment and Investment." Once finalized by the BDAC, each state would have the option of adopting the code. An AT&T executive who is on the FCC advisory committee argued that the recommended tax should apply even more broadly, to any business that benefits financially from broadband access in any way. The committee ultimately adopted a slightly more narrow recommendation that would apply the tax to subscription services and advertising-supported services only.
The BDAC model code doesn't need approval from FCC commissioners -- "it is adopted by the BDAC as a model code for the states to use, at their discretion," Ajit Pai's spokesperson told Ars. As for how big the proposed taxes would be, the model code says that states "shall determine the appropriate State Universal Service assessment methodology and rate consistent with federal law and FCC policy."
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FCC Panel Wants To Tax Internet-Using Businesses, Give the Money To ISPs

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  • Gotta love it! (Score:5, Insightful)

    by fustakrakich ( 1673220 ) on Wednesday December 12, 2018 @08:55PM (#57795378) Journal

    We're letting *AT&T, Comcast, Google Fiber, Sprint, and other ISPs and industry representatives* write our tax code. I guess it's better than letting Enron, Exxon, and DuPont write them... Oh wait, they probably do

    • Re:Gotta love it! (Score:5, Informative)

      by randomErr ( 172078 ) <ervin,kosch&gmail,com> on Wednesday December 12, 2018 @09:25PM (#57795550) Journal

      And Facebook and Twitter [slashdot.org] is pushing to have phone taxed so that people will use their messaging and VOIP services.

    • by mi ( 197448 )

      We're letting *AT&T, Comcast [...] write our tax code.

      False. Right there in the write-up, don't even need to RTFA (emphasis mine):

      the model code says that states "shall determine the appropriate State Universal Service assessment methodology and rate consistent with federal law and FCC policy."

      • Re:Gotta love it! (Score:5, Informative)

        by ShanghaiBill ( 739463 ) on Wednesday December 12, 2018 @09:35PM (#57795596)

        It has to be at the state level. A federal tax would violate the tax and spending Uniformity Clause [wikipedia.org] of the United States Constitution.

        This is, of course, assuming anyone still cares what the Constitution says.

        • by lgw ( 121541 )

          Unless it was a tariff on the import and export of bits at the border, then it's fine. It is nice that we don't have a national sales tax, however.

        • That's not what that means. That means that if it is done at the Federal level, the tax rate has to be same everywhere.

          This is at the State level, because the FCC isn't Congress and can't pass a tax. And Congress would never do it, they have to stand for election.

          You don't even say anything about what you think wouldn't be uniform.

          • You don't even say anything about what you think wouldn't be uniform.

            How many tech companies does Mississippi have?

      • Re:Gotta love it! (Score:5, Insightful)

        by WaffleMonster ( 969671 ) on Wednesday December 12, 2018 @09:57PM (#57795678)

        False. Right there in the write-up, don't even need to RTFA (emphasis mine):

        USF is a shining example of how not to implement a tax.

        1. Regressive taxation of a (once) essential service. About as ridiculous as taxing food to subsidize food for the poor.

        2. Tax rate is ambiguous and incalculable subject to unnecessary amounts of complexity where larger providers have inherent advantage to leverage their ability to do the necessary paperwork to pay a lower rate. Only the interstate component of telephone service is taxable so providers either have to use default "safe harbor" rate or conduct a "study" using a methodology the FCC has to sign off on to determine the effective tax rate given portion of service that is interstate.

        To pour salt on the wound safe harbor rate for certain categories of telephone service is astronomical. Wireless safe harbor for example is half that of Internet OTT voice service for no reason other to fuck over small providers because they can.

        the model code says that states "shall determine the appropriate State Universal Service assessment methodology and rate consistent with federal law and FCC policy."

        Calculation methodology is irrelevant... AT&T and crew still controls who gets the money (themselves) and what rate will be subject to factors and criteria's set by states.

      • It's still being pushed by these companies. Yes they will let each state set it's rate, but the implementation of the concept is being pushed by this organization made up of... The major ISP's. So yes the GP is correct.
        • by mi ( 197448 )

          Yes they will let each state set it's rate

          What if a state decides to set it to zero? You'll still be outraged?

    • Re:Gotta love it! (Score:5, Informative)

      by Jane Q. Public ( 1010737 ) on Thursday December 13, 2018 @12:43AM (#57796220)
      This Pai jerk needs to go. Very soon.

      You know what FCC just did? They just declared SMS to be an "information service" like internet, as opposed to communication.

      That means now carriers can now choose to slow down, time-delay, or even block SMS any time they want.
      • That means now carriers can now choose to slow down, time-delay, or even block SMS any time they want.

        My own experience tells me that the first two are definitely already happening.

    • Historically American's violently objected to the government instituting taxes to enrich the profits of select corporations [wikipedia.org] How times have changed.
    • by mysidia ( 191772 )

      Yes.... this is absolutely insane and stinks of ISP greed: this is a problem created mostly by the ISPs themselves and THEY should be paying a majority of the tax burden for it by having it subtracted from their profits. We should not be trying to tax internet-based businesses to fund something that has nothing to do with supporting these businesses.. we should be taxing every broadband connection above a certain peak theoretical throughput (e.g. 1.5 megabit) to individuals and for-profits with a bas

  • by kimgkimg ( 957949 ) on Wednesday December 12, 2018 @08:56PM (#57795386)
    Because you haven't given ISPs enough ways to screw the consumer and make money already? Unbelievable.
    • by Anonymous Coward on Wednesday December 12, 2018 @09:03PM (#57795438)

      I thought that the reason we got rid of net-neutrality is because of our faith in the free market.

      So why don't we just let the free market bring faster Internet to places that need it? Why do we need *both* an unregulated ISP market *and* tax-funded support for that market?

      Of course I am being rhetorical. They want *all* of our money, every penny, and they will abuse every bit of power they have to get it.

    • Two things wrong with this plan.
      You mentioned the first one: handing tax money to ISPs.

      The second one:
      We have far too many different taxes, and associated paperwork and bureaucracy, already. No need to invent a new type of tax. If we DID want to give taxpayer money to X, just write them a check and if that means increasing taxes, do it. Propose a 1% increase in the existing taxes to pay for it. We don't need 784 different taxes.

      We had a discussion here on Slashdot about that last week.
      Even before you see t

      • Not in the US, but guessing this is a similar tax setup.

        But as an employer I absolutely hate hate hate hate Payroll tax. It's technically not that much, and pales into insignificance compared to others. But I find something truly obnoxious about paying a tax to employ someone.

        • When I had a small business, every year I had to fill out forms to pay business personal property tax of less than $5. The state actually called me, somewhat angrily, about another tax that was less than a dollar.

          How much do you think it cost the state to provide an office, computer, etc, and pay the person, to call people about a 87 cent tax? Plus the cost of the forms, my time filling out the forms, etc. It's just a compete waste.

          • by oldgraybeard ( 2939809 ) on Wednesday December 12, 2018 @11:40PM (#57796038)
            I still run a small(tiny me) business 30+ years. I did outside contractor work for 3M corp for over a decade. And I was required to pay for a Workers Comp. Ins. Policy the whole time. Because the state of MN required 3M to furnish the Workers Comp. policy number to them for all their vendors. Every year the state of MN would contact me and ask why I have a workers comp policy but all my reports have 0 payroll. And I explain and they would go huh, interesting.
            Everything government does has a cost and no one in government has a clue about the real world.

            Just my 2 cents ;)
            • by oldgraybeard ( 2939809 ) on Wednesday December 12, 2018 @11:49PM (#57796076)
              For those who do not know, the owner of a business can not make a claim on the business workers comp policy. i was required by the government(over sight and regulations) to buy Insurance I could never make a claim on.
              • Sounds like you'd have been better off to setup a corporation of some sort that employed you?
            • Because the state of MN required 3M to furnish the Workers Comp. policy number to them for all their vendors.

              Actually, if you didn't have your own Worker's Comp policy as a subcontractor for 3M, then the insurance company covering 3M for Worker's Comp would have billed 3M for your coverage. Worker's Comp premiums are based off of payroll and it's an accounting exercise to correlate payments to subcontractors with their WC policy numbers to then deduct those amounts from their own payroll totals that are

              • i agree 3M was covering their ass. But you are missing the point. 3M is covering their ass for workers comp ins.regulations made by state government. And which the Insurance companies and 3M were following.
                Anyway I paid for insurance I could never make a clam on due to again government rules. i owned the business so i could never make a claim! on a product i was required by the government to buy so something of no value.
                just because the insurance companies and 3M were the enforcers it still all goes back
      • Re: (Score:2, Insightful)

        by lgw ( 121541 )

        You don't understand: big companies have money. The job of the government is to tax all the things. Europe has been far less shy about blatantly inventing reasons to take billions from companies.

    • Maybe we shouldn't have created a government bureaucracy capable of enacting laws like this then. Is it any wonder that corporations would attempt to seize control over it and bend it to their own whims?
    • Re: (Score:2, Insightful)

      by Anonymous Coward

      The ISPs listed also want to be content providers.

      So all businesses that are solely content providers are competitors.

      So they want to tax their competitors, and have that tax money delivered directly to them.

      Of course their competitors will just pass the tax along to the consumers, which is fine by the ISPs because the higher costs will drive more consumers to go for the cheaper content provided by the ISPs.

      You remarked that this is "unbelievable." I disagree. This behavior is completely consistent with t

  • by rsilvergun ( 571051 ) on Wednesday December 12, 2018 @08:56PM (#57795388)
    who tend to vote for them. Not that I mind rural communities getting the Internet, but not like this. Make it municipal broad bank. A country just did it for about $5 bucks a month. Verizon got billions of my money to build out rural fiber, kept the money and never did the work.

    No more. Fund municipal broadband out of the General fund or tell the fuckers to fuck off. All this does is charge me $5 bucks a month (I pay for business class at home) for free money in AT&Ts hands.

    Once again, we've got an election in 2 years. Show up at your primary and vote the fuckers out. Then show up at the general and put some real pro-consumer folks in. We had plenty of them in the primary in 2018 but so few showed up for the primary that most of these yahoo incumbents survived. Again, no more. Primary them and then vote in pro-worker and pro-consumer reps who refuse corporate PAC money.
    • by mishehu ( 712452 ) on Wednesday December 12, 2018 @09:06PM (#57795444)
      The funny thing is that you think that the rural voters are going to get anything out of this proposal. They won't. Hell, the FCC doesn't even really know how many households out there can and cannot get broadband services...
      • by rsilvergun ( 571051 ) on Wednesday December 12, 2018 @10:05PM (#57795736)
        They're not going to get squat, but the GOP will get a photo op where they tell them they're gonna get Internet and the propaganda news outlets they watch will trumpet that. Then when the Internet never materializes they'll blame it on tax and spend liberals' job killing regulations.

        Keep in mind I'm not necessarily blaming the Rural folks for falling for this crap. The big reason I want them to have internet is so they can stop watching cable and over air TV and get out of the propaganda bubble their in. I think it would be great for the country as a whole. Those communities have massive hospital shortages and problems with clean drinking water. The American left (think the Bernie wing of the Democratic party) wants to solve those problems, but they keep losing elections to rural voters (who, thanks to the Senate, Electoral college and gerrymandering have about 40x the voting power of a city voter) keep shooting down attempts to help them.

        If we could somehow get the message to them about how much the GOP is screwing them over we could fix just about everything.
        • Right, it's the local left-wing Democratic Party politicians who are the champions of putting politics and special deals for their buddies aside and just working on solving problems for people.

          Never mind what they actually do, as evident in all the long time Democratic political strongholds like Detroit, Chicago, Baltimore, etc.

          But hey, don't believe your lying eyes, we really just need to put them in charge of more communities and this time it'll be different, right?

          • by Cyberax ( 705495 )

            Never mind what they actually do, as evident in all the long time Democratic political strongholds like Detroit, Chicago, Baltimore, etc.

            Which are so much worse than Wichita, Charlotte and Charleston?

            Why not look at the horror dystopia of Portland, New York and Seattle?

          • by meglon ( 1001833 )
            You need to take stock of all the red states in the south that are basically the ass end of the US in pretty much every bad category out there. Or, if you had a brain, you could look at the what happened when Democrats gained control of a state and implemented their agenda (California, who balanced it's budget and started running a surplus AND increased services), and compare that to when Republicans gained control of a state and implemented it's agenda (Kansas.... basically became the exact asshole of the
          • until the "New" Democrats, aka the Clinton Dems, shift the party to the right.

            As for Chicago & Detroit: National problems (like the manufacturing base being outsourced or our disastrous healthcare system) can't be solved at the local level. Who knew?
        • by mishehu ( 712452 )
          Oh I'm with you man, as I live just beyond the boundaries of the suburb-exurb in my area, and I'm about 1 mile from the nearest fiber pull, but they won't pull it up or even tell me how many households need to sign up in between my house and the fiber for them to pull it. In fact, they (Ma Bell) can't even figure who in their organization would know that answer. I am of the opinion that if we don't get this whole country connected with a decent minimum baseline standard (25 mbps would be a start) then tho
    • by Stormy Dragon ( 800799 ) on Wednesday December 12, 2018 @09:20PM (#57795524)

      It's not even a giveaway to rural communities, it's a give away to big telecom companies. There's already existing fees to pay for rural broadband. The telecom companies just take the grants and never end up building the stuff they promise and the government never calls them on it or forces them to return the funding.

      • as give away to rural communities. A rural voter has somewhere around 40x the voting power of a city voter thanks to our Senate, Electoral College and Gerrymandering. We need to get those folks to stop falling for this crap and get on the side of the rest of the working class.
        • as give away to rural communities. A rural voter has somewhere around 40x the voting power of a city voter thanks to our Senate, Electoral College and Gerrymandering. We need to get those folks to stop falling for this crap and get on the side of the rest of the working class.

          That's why equal representation is enshrined in our constitution. Not proportional representation. Equal representation.

          "There's more of us, so they don't count" is not valuable to a political process.

    • This is exactly it. I support rural broadband, but make the "i hate big gubmint" crowd pay for it themselves. If this gets passed, they'll be on broadband from Bumfuck, North Dakota yelling online about how the government wastes *their* money.

  • by fahrbot-bot ( 874524 ) on Wednesday December 12, 2018 @09:15PM (#57795494)

    Since "Internet-using" companies already pay their ISPs for access and bandwidth, like everyone else does, perhaps the ISPs could take some their -- what do you call them, ah, yes -- enormous profits and use them to build rural infrastructure all on their own. Sure, perhaps the ROI / profits from that won't be enough to list under the "Rape and Pillage" section of the quarterly reports, but maybe people will hate ISPs a little less -- except, obviously, for Comcast. :-)

    • Or have the government build out the internet everywhere the corporations didn't, using that money.
    • perhaps the ISPs could take some their -- what do you call them, ah, yes -- enormous profits and use them to build rural infrastructure all on their own

      They are. Not to the extent we want them to, but to a certain extent, they are. They just want someone else to foot the bill.

      But if they get this way, I guarantee you that they will define "rural" as generously as possible (because they're already writing the rules), to maximize how much of this money they can spend on -existing- customers that they alread

  • How About... (Score:5, Interesting)

    by Stormy Dragon ( 800799 ) on Wednesday December 12, 2018 @09:15PM (#57795496)

    ...we sue AT&T, Comcast, and Verizon for the $400 billion of public funding they already received for rural broadband and just pocketed and we can use that to provide rural broadband?

    • we sue AT&T, Comcast, and Verizon for the $400 billion of public funding they already received for rural broadband and just pocketed

      If the amount of money were even close to that level and the case for liability even close to that clear, any number of creative and enterprising class action lawyers would have swarmed over this a long time ago.

      • I don't think a lawyer can just sue on behalf of the government. Cause it's the government that got screwed over, not the farmers. Or rather, the farmers got screwed, but they only violated the contract with the government.

        • I don't think a lawyer can just sue on behalf of the government.

          No, but a lawyer can sue on behalf of a bunch of farmers. That's the class action bit.

          Cause it's the government that got screwed over, not the farmers. Or rather, the farmers got screwed, but they only violated the contract with the government.

          If the ISPs violating the contract with the government screwed the farmers, that starts to sound an awful lot like the farmers were third-party beneficiaries under the contract. That could give them standing to sue.

  • to make a new innovative network that's community broadband ISP aware.
    Let a monopoly telco return with a network they 100% control and demand a town/city accepts that monopoly network they pay for?
  • by Joe_Dragon ( 2206452 ) on Wednesday December 12, 2018 @09:30PM (#57795568)

    it's like giving the gas tax to private toll roads and no they will not be made into free roads.

  • by Jody Bruchon ( 3404363 ) on Wednesday December 12, 2018 @09:31PM (#57795576)
    You're already paying the fuckers! CenturyLink is being paid $500 MILLION in tax money yearly for rural broadband expansion and they're only using it to cover areas that someone else covers already so they can stifle competition, completely ignoring unserved areas. The rationale behind municipal broadband bans is that it's unfair to compete with the government because they have tax authority, yet they gladly take tax money and use it to be anti-competitive. NO MORE TAX MONEY TO BIG ISPs!
  • ITFA motherfuckers (Score:4, Insightful)

    by WaffleMonster ( 969671 ) on Wednesday December 12, 2018 @09:33PM (#57795588)

    They can't tax Internet use. It's literally against the law.

    But don't let that stand in the way of FCC announcing to the country how totally, utterly and completely corrupt they are.

    • You realize the FCC didn't vote on, nor participate in, nor announce any of this, right?

      It's there in the summary, this is a suggestion to the States from the BDAC, an industry recommendation board.

      Like pretty much all the other industries, they think we should tax or regulate other people, especially their competition, and give them the benefits.

      The frequency with which they get their way is why we need to not grant these regulators the power to actually do it for them.

      • You realize the FCC didn't vote on, nor participate in, nor announce any of this, right?

        It's there in the summary, this is a suggestion to the States from the BDAC, an industry recommendation board.

        I don't know how to parse the above in a way that can be made self-consistent. BDAC is committee created by the head of the FCC in his official capacity as such.

        Specifically I don't understand:

        Why don't the fruits of an FCC committee constitute FCC participation?

        Why are public notices not announcements?

      • by Cylix ( 55374 )

        I also wonder if this means comcast stops charging extortion fees to service providers?

        • by sconeu ( 64226 )

          I also wonder if this means comcast stops charging extortion fees to service providers?

          They're so cute when they're naive, aren't they?

  • by bjdevil66 ( 583941 ) on Wednesday December 12, 2018 @09:40PM (#57795616)

    ...in infrastructure projects like this one, right?

    Well, you got net neutrality overturned. So go invest in that infrastructure now... Oh wait, you don't want to pay for it now. What's your lame-ass excuse now?

    You lying, greedy, ******* bastards.

  • ...and the donkey he rode in on! Hopefully he'll be an add-on to the Trump impeachment proceedings.
  • Apply to any business the benefits from broadband internet ? Does that apply to AT&T and Comcast as well as they are entirely dependent on the internet and broadband ?

  • Once you start Taxing things, it doesn't stop and it won't ever go away.

    I seem to have heard this somewhere before:
    No taxation without representation...

    https://en.wikipedia.org/wiki/... [wikipedia.org]

  • Note, they are calling mobile internet rural broadband now, some of the most expensive bandwidth to purchase as a consumer.

    We want to tax businesses to pay the wireless providers for their already lucrative business.

    Seems like businesses don't want the hassle of creating a successful business, but would rather get subsidies from those who put in the effort.

  • Someone's Ajitating for a hurt real bad. Where are the Trump defenders?
  • They pay for their own bandwith.

    It's the customers on these networks that GENERATE the requests for traffic.

    It's not like these services are simply broadcasting into these networks.

    Fucking retarded.

  • Space based systems, 1-web and starlink, are about to deliver GB speeds to all over, and now FCC is addressing rural.
  • ... who, like me, (retired IT guy, 73 years old) predicted back in the mid-late 80s that the government would tax the Internet?

  • One of the reasons we build cities is the concentration of resources makes it easier to provide infrastructure. Sure, it would be nice to live 5 miles from your nearest neighbor and have fiber to your house. It would be nice to live in New York City and have a couple acres with a stream running through it. But you can't have everything. We already have satellite. Sure it's not awesome, but it should be adequate for most peoples needs. If you want streaming Netflix or low-latency gaming, maybe farming
  • Is it in cash, deposited into offshore accounts? Or are his corporate masters going to reward their good little doggy when he's out of the FCC one day, giving him some high-level job for outrageous pay for doing little more than shuffling papers around and getting sucked off by his secretary every day?

    Zero chance any of this money ISPs will get from this is going to go to improving anything for consumers, in fact I expect they'll just claim they're 'improving' things, just so they have an excuse to jack
  • People welfare: Bad
    Corporate welfare. Good

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