One of the biggest lobbying fights in the nation's capital this year could involve a traditionally non-Washington subject: whether AM and FM radio stations should pay royalties to performers on recorded music played over the airwaves, and if so, what those rates should be.
According to the National Association of Broadcasters, the bill would impose an additional financial burden on broadcasters during a recession and would drive many music stations into talk radio or out of business. Moreover, the industry group says, radio airplay is already free promotion for artists.
For more than 80 years, radio and the recording industry have enjoyed a mutually beneficial relationship: free play for free promotion. And it works. Congress has continually recognized that local radio is different from other musical platforms and should not be subject to a performance tax. Local radio is free, so everyone, regardless of income, can have access to it. Local radio also has to fulfill certain public service obligations that other platforms do not. And importantly, the free music that radio plays provides free promotion to the record labels and artists – up to $2.4 billion annually.
But the labels–like many businesses–are struggling in this economy. They have failed to adapt to the digital age, and find their business model is broken. And now they want to impose a fee called a performance tax on local radio stations to subsidize their losses.
A performance tax would threaten the local radio stations that communities depend on. It would financially hamstring stations, stifle new artists and harm the listening public who rely on free local radio.
The money generated from the performance tax would flow out of our communities and into the pockets of the major record labels – and three out of the four are foreign-owned. The record labels would like for you to think this is all about compensating the artists, but in truth the record labels would get at least 50 percent of the proceeds from a tax on local radio.
If you’re one of the 235 million people who listen to radio each week, a tax could reduce the variety of music radio stations play, and all but eliminate the possibility of new artists breaking onto the scene.
Again, the performance tax affects our communities. Radio stations are major contributors to public service – generating $6 billion in public service annually, providing vital news and community information and free airtime to help local charities. If a tax were imposed, stations’ critical community service efforts could be reduced.
There are currently two bills pending in Congress that would levy a performance tax on local radio – H.R.848, sponsored by Rep. John Conyers (MI-14) and S.379, sponsored by Sen. Patrick Leahy (VT). Your members of Congress need to hear that you strongly oppose these bills.
Additionally, anti-performance tax resolutions have been introduced in the House and Senate in support of local radio. In the Senate, Sens. Blanche Lincoln (AR) and John Barrasso (WY) introduced S. Con. Res. 14, and in the House, Reps. Gene Green (TX-29) and Mike Conaway (TX-11) introduced H. Con. Res. 49. Both are known as the Local Radio Freedom Act. Encourage your senators and representative to cosponsor these resolutions.
Please take action now http://www.noperformancetax.org/en/Take%20Action