Digital channels' subscription TV charged a 5% tax

WASHINGTON DC: The US government's Federal Communications Commission said last week that pay-TV companies would be subject to a 5% levy on subscription service income from new digital channels.

WASHINGTON DC: The US government's Federal Communications Commission said last week that pay-TV companies would be subject to a 5% levy on subscription service income from new digital channels.

Stations running pay-per-view films or sports events will be forced to give up 5% of their gross revenue to the US Treasury.

Satellite broadcasters are also being told to set aside 4% of capacity for public programming. The FCC is not requiring free over-the-air broadcasters to give up commercial ad revenue.

Television stations are being given digital capacity to operate second channels. The Telecommunications Act provides that the government must receive a portion of its income if these channels are revenue earning.

The FCC is trying to ensure that digital broadcasting is used for some public benefit.

The FCC is looking at a provision that would exempt public TV stations from this provision. Public TV is supported by donations.

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