To preempt of local taxation with respect to satellite digital audio radio services and to provide for determining State authority for taxation of satellite digital audio radio service.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Satellite Radio Freedom Act''.

SEC. 2. DEFINITIONS.

    For purposes of this Act:
            (1) Customer.--The term ``customer'' means--
                    (A) a person or entity that contracts with a 
                provider of satellite digital audio radio service; or
                    (B) if the end user of such satellite digital audio 
                radio service is not such contracting party, the end 
                user of such satellite digital audio radio service, but 
                only for purposes of determining the place of primary 
                use;
        but does not include a reseller of satellite digital audio 
        radio services.
            (2) Local taxing jurisdiction.--The term ``local taxing 
        jurisdiction'' means any municipality, city, county, township, 
        parish, transportation district, or assessment jurisdiction, or 
        any other local jurisdiction in the territorial jurisdiction of 
        the United States with the authority to impose a tax or fee, 
        but does not include a State.
            (3) Place of primary use.--The term ``place of primary 
        use'' means the residential street address or the primary 
        business street address representative of where the customer's 
        use of the satellite digital audio radio service primarily 
        occurs.
            (4) Provider of satellite digital audio radio service.--The 
        term ``provider of satellite digital audio radio service'' 
        means a person who transmits, broadcasts, sells, or distributes 
        satellite digital audio radio service.
            (5) Satellite digital audio radio service.--The term 
        ``satellite digital audio radio service'' means any radio 
        communication service provided in the 2320-2345 MHz frequency 
        band pursuant to a license from the Federal Communications 
        Commission.
            (6) State.--The term ``State'' means any of the several 
        States, the District of Columbia, or any territory or 
        possession of the United States.
            (7) Supplemental terrestrial repeater.--The term 
        ``supplemental terrestrial repeater'' means a complementary 
        terrestrial transmitter used to retransmit signals received 
        from one or more satellites used to provide satellite digital 
        audio radio service.
            (8) Tax or fee.--The terms ``tax'' and ``fee'' mean any 
        local sales tax, local use tax, local intangible tax, local 
        income tax, business license tax, utility tax, privilege tax, 
        gross receipts tax, excise tax, franchise fees, 
        telecommunications tax, communications tax, or any other tax, 
        license, or fee that is imposed for the privilege of doing 
        business, regulating, or raising revenue for a local taxing 
        jurisdiction, other than ad valorem property taxes.

SEC. 3. PREEMPTION OF LOCAL TAXATION WITH RESPECT TO DIGITAL AUDIO 
              RADIO SATELLITE SERVICE.

    (a) Preemption.--
            (1) Exemption from local taxation.--No tax or fee shall be 
        imposed by a local taxing jurisdiction on the provision, 
        purchase, or use of satellite digital audio radio service, or 
        on a provider of satellite digital audio radio service.
            (2) Exception.--Subsection (a)(1) shall not apply to any 
        tax or fee imposed by any local taxing jurisdiction on 
        satellite digital audio radio service to the extent that a 
        provider of satellite digital audio radio service owns, leases, 
        or otherwise uses a supplemental terrestrial transmitter that 
        is physically located in such jurisdiction.
    (b) Preservation of State Authority.--This section shall not be 
construed to prevent taxation of a provider of satellite digital audio 
radio service by a State or to prevent a local taxing jurisdiction from 
receiving revenue derived from a tax or fee imposed and collected by a 
State.

SEC. 4. STATE TAXATION OF SATELLITE DIGITAL AUDIO RADIO SERVICES.

    (a) Limitation.--This section does not provide the authority for a 
State to impose a tax or fee unless all of the following circumstances 
exist:
            (1) The place of primary use is physically located within 
        the physical boundaries of the State.
            (2) The law of such State authorizes the imposition of such 
        taxes or fees.
    (b) Charges.--
            (1) Sourcing for purposes of state taxes and fees.--All 
        charges for satellite digital audio radio services subject to 
        imposition of taxes or fees by a State shall be sourced to the 
        customer's place of primary use as defined in section 2, 
        regardless of where the satellite digital audio radio service 
        transmission services originate, terminate, or pass through.
            (2) Sourcing for other purposes.--Notwithstanding the law 
        of any State, all charges for satellite digital audio radio 
        service shall be sourced to the customer's applicable 
        residential street address or the primary business street 
        address of the customer.

Summary: Satellite Radio Freedom Act - Prohibits any tax or fee from being imposed by a local taxing jurisdiction on the provision, purchase, or use of satellite digital audio radio service or on a provider of such service. Makes an exception to the extent that a provider of such service owns, leases, or otherwise uses a supplemental terrestrial (land-based) transmitter that is physically located in such jurisdiction. Authorizes State taxation on such service only if: (1) the place of primary use is physically located within the boundaries of the State. And (2) the law of such State authorizes the imposition of such taxes or fees. Requires the charging: (1) of such taxes or fees to be sourced (based) on the customer's place of primary use, regardless of where the services originate, terminate, or pass through. And (2) for such service to be based on the customer's residential street address or primary business address.