IRS tries to tax outer space

Tax officials in Los Angeles have come up with a great idea to swell their coffers - taxing companies for their goods in outer space. By goods, read satellites orbiting Earth.

According to the leeches in Los Angeles County, eight satellites that belong to Hughes Electronics can be classed as "moveable property" and as such they should be taxed as if they were boats or construction equipment.

Ridiculous as it may seem, if the tax office pulls the extra-terrestrial idea off, it stands to profit to the tune of several million pounds. Needless to say, Hughes is unimpressed and its lawyers have hit upon their own opinion of outer space's tax laws.

The satellites are orbiting the Earth at a fixed point, above the equator, they say. Since they are launched in either Florida or French Guyana, they never cross California and as such cannot be in the jurisdiction of the Los Angeles tax officials. After 10 or 15 years, they are then blasted into a dead zone in space.

Get out of that one Mr Taxman.

[Quick note to our American cousins: yes, we know that the IRS and county/state taxations are different systems. We used "IRS" in the headline for brevity. However, as one reader pointed out: "In my case, as soon as I read the headline I thought wtf? The IRS isn't
responsible for taxing tangible property."

We are impressed at your intricate understanding of the US tax system. But then we reckon it's something you all wish you didn't know :-). ] ®