This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.  
  • Delicious




Satellite Taxation Plan Fails To Get Off The Ground

by Mike Godfrey, Tax-News.com, Washington

20 July 2001

When the tax assessor for Los Angeles Country, California, proposed during a routine audit of Hughes Electronics earlier this month, that eight satellites owned by the company could be subject to property taxes, observers were incredulous. The satellites, which are thought to be worth around $100 million each, are indeed owned by the country's largest satellite TV broadcaster, and are not taxable anywhere else. However, they are also positioned 22,300 feet above the equator, which many feel is beyond the remit of the California tax authorities.

However, the innovative suggestion was shot down in flames last week, when the State Board of Equalization voted to draw up a rule outlawing levies on spacecraft. Rick Auerbach, the County Assessor in question, is more than a little defensive about his role in the whole affair: 'We saw the satellites on the books and wondered if they were taxable,' he explained. 'People always confuse me with the tax collector. My job is not to make sure that the county gets a lot of money, it's to place value on property according to state law.'

Strange though it may seem, moveable corporate property which is not always physically in the county can sometimes still be subject to property taxation wherever the company that owns it is located. However, as a spokesman for Hughes Electronics pointed out, property taxation is levied on the understanding that the county will provide services for that property. 'If one of our satellites caught on fire, I think the county would have a hard time trying to put that fire out for us,' he observed.

Despite the Board's decision, Mr Auerbach still has his beady eye on the final frontier.'I'm happy as long as the decision is consistent with the state constitution,' he said. 'But if it's not, it is my obligation to challenge the rule in court.' The Los Angeles County tax department has obviously taken the message of 'Live long and prosper' to heart...

.

 

 






Write a comment