Comcast gets big tax break that was designed for Google Fiber

(credit: Paramount/CBS)

When the Oregon legislature changed the state's tax rules last year, it was trying to convince Google Fiber to bring its high-speed Internet to Oregonians.

But lawmakers apparently didn't realize that the rule change would also hand a big tax break to Comcast. The new rule reduced property taxes for companies that offer gigabit-speed Internet service, which Google sells for $70 a month with no construction fees passed on to customers. But the rule change didn't specify that companies have to offer gigabit service at any particular price in order to qualify for the tax break. Comcast thus now qualifies for lowered property taxes because it offers 2Gbps Internet service, despite charging prices that would steer most ordinary customers to slower Internet speeds. Comcast's 2Gbps service costs $300 per month, with $1,000 in startup fees.

Rep. Phil Barnhart (D-Eugene) told utility regulators yesterday that the tax break was meant to spur investments in new networks and that legislators never considered that a company charging such high prices for gigabit service would get the tax break, according to The Oregonian.

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