A bill in Maine is about to impose taxes on streaming services that use the phone poles and wires in a municipality to provide material to users.
A franchise agreement or contract with the municipality is required for “a video service provider to offer or provide its services within a municipality,” according to LD 1967, An Act to Support Municipal Franchise Agreement, which passed the Maine Senate and is supposedly headed for Gov. Janet Mills’ signature.
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The most recent state to call for streaming providers to face the same taxes as cable companies is Maine. In response to the growing trend of cord cutting, bills have been introduced all throughout the United States in recent years with the goal of somewhat offsetting the financial losses suffered by cable providers.
There is opposition to the idea of treating streamers like cable services.
The House of Representatives in Missouri filed a bill last month that would stop local governments from tack on the additional cost.
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According to a U.S. judge, streamers shouldn’t be taxed because they don’t have a physical presence in communities as cable TV providers do.
Comcast, the owner of NBCUniversal, the parent company of streamer Peacock, has reportedly criticized the Maine legislation. Given that Comcast operates a streaming service in addition to being a cable business, Comcast would probably be subject to the proposed tax.
A senior lawyer for the cable TV provider wrote Mills a letter pleading for the bill to be shelved.
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Kimberley D. Harris, executive vice president of Comcast and general counsel of NBCUniversal, stated in a letter obtained by Policyband that “the [bill] unfairly singles out Peacock and a handful of other streaming services for unprecedented and discriminatory fees and regulatory obligations.” “It will only be applicable to customers in Maine who use broadband Internet service from an affiliate, Comcast Cable, to access Peacock’s linear and on-demand video content.”
Rep. Melanie Sachs, the bill’s sponsor, is said to have stated that the goal of the legislation is to update the state’s antiquated cable franchising laws, which date back several decades.
“There is no animosity toward cable operators,” Sachs stated in a Policyband interview.
Sachs and Comcast did not immediately respond to requests for comment.
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