[92759] in North American Network Operators' Group
Re: Broadband ISPs taxed for "generating light energy"
daemon@ATHENA.MIT.EDU (Owen DeLong)
Tue Oct 10 12:13:41 2006
In-Reply-To: <Pine.SOC.4.61.0610100807310.27414@paixhost.pch.net>
Cc: Michael.Dillon@btradianz.com, nanog@nanog.org
From: Owen DeLong <owen@delong.com>
Date: Tue, 10 Oct 2006 08:40:34 -0700
To: Bill Woodcock <woody@pch.net>
Errors-To: owner-nanog@merit.edu
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On Oct 10, 2006, at 8:08 AM, Bill Woodcock wrote:
>
>> Sounds reasonable to me. Since the sale of energy is
>> usually measured in kilowatt-hours, how many kwh of
>> energy is transmitted across the average optical fibre
>> before it reaches the powereda mplifier in the destination
>> switch/router?
>
> Also, remember, it's _net_ energy delivered which matters... I'm
> sure the
> customer is delivering light back toward the ISP as well.
>
> -Bill
From my reading of the article, it appears that they are attempting to
tax at 12.5 percent, the ISPs entire service revenue because that
revenue is derived from the delivery of light energy, thus making the
"IP service" actually a "utility product".
It looks like the tax department is arguing that what is currently being
billed/taxed as a service is actually a product and such product should
be subject to VAT.
It would be akin to California adding 7.75% to my ISP bill for sales
tax.
Owen
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