The Senate last week fine-tuned the language in its proposed economic stimulus package, cutting $1.5 billion from the $9 billion proposed for broadband buildouts and clean-up some of the language to tighten up tax credits for all buildouts.
Under the original language, Telcos might have gotten a $1.6 billion tax break from a 20 percent tax credit for any investment in say 100 Mbps broadband service to any home.
Sen. Jay Rockefeller, D-W.Va., was the original proponent of the $9 billion broadband investment and proposed an amendment to significantly tighten the rules and increase the amount of tax credit. The new plan would only offer credits for broadband services to rural and unserved areas, with a 40 percent credit for 100 Mbps or better service and 30 percent for slower service of at least 5 Mbps. Wireless data services allowing downloads of 6 Mbps or better also get the 40 percent credit and 30 percent if they manage at least 3 Mbps.
One concerning part is that tax credits for Internet service to low-income areas have been eliminated too. The notion is that some operators were already planning on bringing broadband services to low-income neighborhoods. Read more on the NYT tech blog.
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