The Radio Tax

Last week I wrote about how major record labels needed to make a change in order to prevent futher losses and remain viable in today's music market. Well, apparently help may be on the way:

The Performance Rights Act a.k.a. The Radio Tax

Currently, the Performance Rights Act has been proposed to the House of Representatives by Rep. John Conyers of Michigan, and to Congress by Sen. Patrick Leahy of Vermont. Under the act, radio stations would be required to pay royalties based on their revenues, with radio stations making under $1.25 million required to pay a flat fee of as much as $5000, while those making over $1.25 million would be taxed a yet-to-be-determined percentage of their revenues, or a much higher flat rate.

The bill is being promoted as a way for artists to be compensated for the use of their songs on public radio stations. Under the act, however, 50% of the royalties would go to the record label, while the featured artist would receive 45%, and non-featured artists would receive 5%.

As of now, radio stations only pay royalties to the composers of the music they play, but not to the performers. Also, satellite and internet are already required to pay royalties to labels/performers, and are "taxed" at a much higher rate than is proposed for "terrestrial" radio stations. Similar systems are already in place in other countries, including England, France, and Canada.

For more info: http://www.govtrack.us/congress/bill.xpd?bill=h111-848

(I just want to add that it has been just over a year since this bill was first introduced, but it was only recently brought to my attention, so I thought it was worth mentioning.)