Broadband Subsidy Tax Companion Bill Introduced in the House

On Wednesday, a version of the Broadband Grant Tax Treatment Act (BGTTA), a Senate bill that would shield federal broadband infrastructure subsidies from taxation, was introduced in the House of Representatives.

As I described in a November 17, 2022, post to the FSF Blog, Senators Mark Warner (D-VA) and Shelly Moore Capito (R-WV) authored the BGTTA in response to the 2017 Tax Cuts and Jobs Act, which directs the Internal Revenue Service to treat federal grants as taxable income beginning in 2023.

The BGTTA would exempt from taxation federal broadband funding appropriated by the American Rescue Plan Act and the Infrastructure Investment and Jobs Act, including the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) Program.

The House version, which mirrors the Senate draft, is sponsored by Representatives Jimmy Panetta (D-CA) and Mike Kelly (R-PA) and cosponsored by Terri Sewell (D-AL) and Drew Ferguson (R-GA).

Responding to the news, USTelecom President Jonathan Spalter described the bill as "right on the money." And Kelly Cole, CTIA Senior Vice President, Government Affairs, stated that it "maximizes grants, which is vital in the deployment of broadband and closing the digital divide."