I 

112TH CONGRESS 

1ST SESSION H. R. 1804 

To prohibit discrimination in State taxation of multichannel video 

programming distribution services. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 10, 2011 

Mr. SENSENBRENNER (for himself, Mr. CONYERS, and Mr. JORDAN) introduced the following bill; which was referred to the Committee on the Judiciary 

A BILL 

To prohibit discrimination in State taxation of multichannel 

video programming distribution services. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘State Video Tax Fair5 ness Act of 2011’’. 

6 SEC. 2. PROHIBITION. 

7 No State shall impose a discriminatory tax on any 

8 means of providing multichannel video programming dis9 tribution services, including Internet protocol technology 


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1 (or any successor protocol), direct broadcast satellite deliv2 ery, and cable television services. 

3 SEC. 3. DISCRIMINATORY TAX. 

4 (a) DETERMINATION OF DISCRIMINATORY TAX.— 

5 For the purposes of this Act, a tax is discriminatory if 

6 the net tax rate imposed on one means of providing multi7 channel video service is higher than the net tax rate im8 posed on another. 

9 (b) NET TAX RATE.—The net tax rate imposed on 

10 multichannel video service includes any charge levied by 

11 a State legislature or other statewide taxing authority with 

12 respect to, or measured by, the charges, receipts, or reve13 nues from, the provision of multichannel video service, to 

14 generate revenues for governmental purposes. The net tax 

15 rate is the effective rate paid by the provider or its cus16 tomers for the service, offset by any exemption, deduction, 

17 credit, incentive, subsidy, or exclusion that diminishes the 

18 effective rate. 

19 (c) EXCLUSION AND LIMITATION.— 

20 (1) The net tax rate imposed on multichannel 

21 video service does not include any obligation by any 

22 name, whether a duty, fee, charge, payment, or tax, 

23 or other payment obligation, imposed or collected, in 

24 whole or in part, as consideration for, or as a condi25 tion related to, the acquisition of a property right or 


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1 other item or service of value that is paid directly or 

2 indirectly to any State or local taxing authority. 

3 (2) For purposes of paragraph (1), a service 

4 provider is deemed to be paying such an obligation 

5 indirectly to governmental units if, and to the extent 

6 that— 

7 (A) governmental units had previously im8 posed the obligation on, or collected the obliga9 tion from, the service provider or its customers; 

10 (B) the State abolished or limited the obli11 gation; 

12 (C) revenues collected from the payment of 

13 the obligation are directed to a fund other than 

14 the general fund; and 

15 (D) the fund is directed in whole or in part 

16 to compensate the governmental units that had 

17 previously imposed or collected the obligation 

18 for lost revenue. 

19 SEC. 4. EXCEPTION. 

20 (a) CURRENT TAXES.—The prohibition contained in 

21 this Act shall not apply to any tax that was imposed in 

22 its current form before January 1, 2011. Nothing in this 

23 section shall preclude any such tax from being ruled dis24 criminatory or otherwise illegal on any basis other than 

25 the prohibition contained in this Act and nothing in this 


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1 section shall affect the outcome or remedy of any pending 

2 or future litigation invoking other provisions of law. 

3 (b) INTERPRETATION.—Nothing in this section shall 

4 be interpreted to mean that discriminatory taxes in the 

5 multichannel video programming marketplace are accept6 able. It is the sense of Congress that such discrimination 

7 effectively stifles competition to the detriment of all con8 sumers, and that states that have adopted discriminatory 

9 regimes should repeal them forthwith, even if not obligated 

10 to do so under this Act. 

Æ 


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