Supreme Court Won't Hear Satellite Tax Challenge

In a victory for cable operators, the Supreme Court has denied an appeal by DirecTV and Dish of an Ohio tax on satellite service not applied to cable operators.

The lower courts ruled that it was not unconstitutional for Ohio to use the difference in transmission to impose a tax on satellite service that it did not levy on cable. The tax was imposed nine years ago this month, and DirecTV and Dish almost immediately took it to court, saying that the state had imposed a "discriminatory and unfair tax policy that disenfranchises consumers, and our customers, while benefiting local cable operators." Operators have also challenged similar taxes in North Carolina, Utah and Massachusetts. Cable companies have lobbied for DBS-only taxes, arguing that they level the playing field given the local franchise fees cable ops pay, while satellite operators point out they do not put any burden on local infrastructure.