On March 3, 2008, an Appellate Tax Board, the state
board responsible for interpreting Massachusetts
tax laws, ruled in favor of closing the Telecom Loophole by allowing cities and
towns to tax telephone poles and wires over public ways, a decision MASSPIRG is
praising.
This is a victory for all taxpayers.
MASSPIRG has long been an advocate of transparency, accountability, and
fairness in government and the private sector. The decision to close this
loophole eliminates a long outdated “tax break” for telecom companies and
instills public confidence in our tax laws.
The telecom loophole was first
adopted in 1915 as part of a government initiative to bring telephones to homes
when the industry consisted of one phone company, Bell Telephone, with publicly
established profit margins and a heavily regulated market. The loophole
initially exempted telephone companies from paying ‘rent/taxes’ for the use of
telephone poles over public ways. Today
– over 90 years later – utility companies like NSTAR are required to pay
property taxes on above-ground poles and wires, while telephone companies like
Verizon are exempted.
The tax loophole served no modern
public purpose, prevented more efficient use of public space, totaled
approximately $78 million dollars, and forced local assessors to waste taxpayer
dollars chasing after questionable claims by companies who are both utilities
and telecoms.
Whatever your perspective on the
level of taxes, our tax bills are far more palatable when we have confidence in
the tax system; that there is inherent fairness in the system; and no one group
or individual gets unintended or unreasonable tax breaks.
