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Kentucky Governor's Tax Plan Induces Communication Service Insourcing

Gov. Fletcher's "JOBS for Kentucky" plan establishes a 7.62 percent excise tax on communication providers, replacing other state and local taxes

Kentucky Gov. Ernie Fletcher has proposed a tax change that would improve and simplify communications taxes.

"Insight has long advocated that Kentucky's tax system on communications customers and providers is unlevel, unfair and unconstitutional. Kentucky's courts now agree. We applaud Governor Fletcher's plan that will fix this problem, encourage investment by all communications companies and, most importantly, encourage competition for the benefit of all Kentucky consumers," said Michael S. Willner, chief executive officer for Insight Communications.

Fletcher's "JOBS for Kentucky" plan establishes a new broad-based communications excise tax on cable and -- for the first time satellite television providers -- at 7.62 percent, replacing myriad state and local taxes. Also included are all telephone services (wireless and land-based).

"This plan means businesses will no longer be penalized for being based here and that companies will not be rewarded for being based in another state," said Fletcher. "It is essential that we simplify our communications taxes to make them easier to collect, and changed to make sure that they are applied uniformly."