Verizon says telecom industry is singled out on tax break
When one tax assessor said in your article ("Phone pole ruling may be tax windfall," Globe North, April 20) it's "an illogical taxation system," he wasn't kidding.
That's exactly why
The article notes that some poles and wires owned by telecommunications companies are tax-exempt while those owned by electric companies are not. But the article fails to mention that telecommunications companies pay a sales tax on every pole and wire they purchase, while electric companies don't. Or that financial services companies are exempt from paying taxes on certain administrative equipment. Or that newspapers are exempt from paying taxes on their printing presses.
We recognize the need of communities for funding public services, but what is needed are not myopic additions to an already complex and "illogical taxation system." To the contrary, the state should begin to recognize the drivers of the "New Economy," which will generate jobs, income, wealth, and opportunity for all citizens. Doing so means reconsidering the current tax structure in light of future needs of the state to compete for jobs and investment in an increasingly digital communications world.
The original purpose of the telecom tax exemption - to make telecommunications service available in the state - is even more urgent today.
If telecom was the 20th-century driver of political, social, and economic cohesion and well-being, the Internet, which uses those poles and lines, is even more so today.
Telecom taxes are not free money to Massachusetts cities and towns. The citizens of Massachusetts will pay handsomely for the short-term benefits of the tax in the form of higher prices for Internet services, fewer jobs, and generally less economic opportunity - an offsetting hidden tax. Why? Consumers and information network investors will be out of pocket millions of dollars, which means that information networks will be less extensive, less functional, and less supportive of Massachusetts business needs and consumer access to information and online services. Why throttle these engines of economic growth?
While the courts decide the validity of the exemption, the larger issue is this: What tax policy is right for Massachusetts? We think it's a policy that needs to consider taxes, investments, and economic growth across all industries, and not focus on a single tax on one industry.
Phil Santoro
Media Relations, Verizon
