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FTC Mulls Taxes to Save Traditional Journalism

June 3, 2010

The Federal Trade Commission has posted a staff discussion draft paper on how to preserve newspapers and traditional journalism outlets in the Internet age, including some eye-opening suggestions on taxing consumer electronics and wireless spectrum.

It’s not exactly news that the newspaper business is in trouble. Media companies have been among the hardest hit in recent years, even before the recession, and newspapers and other journalism outlets have been paring their staff drastically to compete better in the digital age. Newspaper revenues from advertising have fallen about 45 percent since 2000, according to a report from the Pew Project for Excellence in Journalism cited in the FTC document.

The discussion document does not contain any recommendations endorsed by the FTC, but instead presents a set of suggestions collected by the FTC staff in preparation for a roundtable discussion at the National Press Club later this month.

Among the ideas cited are journalist tax credits, a “News Americorps,” “Citizenship News Vouchers,” and a “Citizenship Media Fund.”

Other suggestions include a 7 percent tax on commercial radio and television broadcast spectrum, a 5 percent tax on consumer electronics (already dubbed the “iPad tax” by CUNY journalism professor and Entertainment Weekly founder Jeff Jarvis), a tax on the auction sales prices for commercial communication spectrum, a 2 percent sales tax on advertising, and a 3 percent tax on monthly Internet service and cell phone bills.

Other proposals include industry-wide licensing arrangements for the news, statutory limits to the fair use doctrine in the Copyright Act, and federal “hot news” legislation to keep various Internet outlets from poaching on the news-gathering efforts of traditional wire services and the like.

All in all, an interesting set of proposals, but one that’s already beginning to stir up controversy in the blogosphere. Anyway, it’s all for a good cause, I’d say: keeping us journalists employed. And some of the tax proposals, in the off chance they ever get enacted, could keep accountants and tax practitioners busy too.

Comments (1)
Nose under the tent.

Government influence in "Independent" news reporting.
Posted by | Friday, June 04 2010 at 4:48PM ET
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