Broadband Groups Urge Hill Committees to Not Count Some Broadband Grants as Taxable Income
The Competitive Carriers Association, CTIA and four other groups urged leaders of the Senate Finance and House Ways and Means committees to pass the Broadband Grant Tax Treatment Act (S-5021), which would amend the Internal Revenue Code to say broadband…
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grants enacted via either statute don’t count as “gross income” (see 2209290067). “The 117th Congress made historic investments in broadband infrastructure by allocating billions to programs” via the American Rescue Plan Act and Infrastructure Investment and Jobs Act, but “if Congress fails to act, grant recipients will be required to return as much as 21 percent of the broadband grants to the federal government in the form of taxes,” the groups wrote Senate Finance Chairman Ron Wyden, D-Ore., House Ways and Means Chairman Richard Neal, D-Mass., and their Republican ranking members, in a letter released Friday. That would leave “millions of Americans without access to the broadband they were promised. In addition to extending the expiring 100 percent expensing benefit, which would have a broader overall impact, Congress should exempt broadband grants from taxation as consistent with the ubiquitous deployment goals reflected in” ARPA and IIJA. The IRS previously “had the flexibility to act unilaterally to exempt some broadband grants from taxation,” including the Broadband Technology Opportunities Program, the groups said: The 2017 Tax Cuts and Jobs Act “changed the statute, declaring that all federal grants, including broadband grants, are taxable as income. With this change in statute, it is now incumbent upon Congress to act to free the ARPA and IIJA broadband grants from taxation and ensure all of the broadband grants awarded will be used to reach Americans with connectivity needs.” The other signers were NTCA, TIA, USTelecom and the Wireless Infrastructure Association.