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Los Angeles plans to tax property in space

16:55 11 July 01
Emma Young

Satellites orbiting thousands of kilometres above Earth can be
classified as movable personal property and therefore be
subject to property tax, say Los Angeles county officials.

Hughes Electronics, based in El Segundo, owns satellites
each worth up to $100 million. A routine audit of the
company's property by county assessors sparked the taxation
idea, according to the Los Angeles Times.

Local lawyers have advised the assessors that taxing these
satellites as "movable personal property", in the same
category as boats, construction equipment and even ice
skating costumes, would be legal.

"It happens with lots of other property. The difference with
the satellites, obviously, is that they're pretty far removed
from Earth," said Los Angeles County Assessor Rick
Auerbach.

But Hughes's lawyers are arguing that since the satellites are
geostationary, they are not strictly "movable".

"Geostationary objects sit above the equator in a fixed
position; they do not rotate around the Earth. So the satellites
we're talking about here are not movable property," said
Larry Hoenig, who is representing Hughes Electronics.

Auerbach is currently focusing on eight satellites owned by
the company between 1991 and 1994. But if the taxation is
eventually allowed, it would apply to all satellites owned by
companies based in California.

Both Auberbach and the satellite company's lawyers say they
think the case will end up in the courts.