Thu, Nov 26 2009
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Published July 02, 2009 12:38 pm - OLYMPIA, Wash. (AP) — As newspapers across the country struggle through a brutal economic climate, papers in Washington state are getting a tax break. Newspapers in WA get tax break during bad times
OLYMPIA, Wash. (AP) — As newspapers across the country struggle through a brutal economic climate, papers in Washington state are getting a tax break. A new law that gives newspaper printers and publishers a 40 percent cut in Washington’s main business tax took effect this week, providing some much-needed relief to the business after a year in which The Seattle Post-Intelligencer printed its final edition and other papers suffered drastic cutbacks. “It’s not a bailout, because it’s not enough money,” said House Majority Leader Lynn Kessler, the Democrat who sponsored the measure. “But it is our way of saying to the newspapers that we do believe you’re incredibly important to our state and our democracy.” The Society of Professional Journalists and the National Conference of State Legislatures was not aware of any other state that has granted a similar tax break to the newspaper industry. In Michigan, a bill that was introduced in May would exempt newspapers from paying that state’s main business tax, but the bill has not yet had a hearing. And several states, including Mississippi, Idaho and Colorado, have existing sales-tax exemptions for newspapers. The Washington tax cut, which will cost the state about $1.3 million a year, was approved despite uneasiness in the industry about newspapers relying on the government they cover for help. But there was also a recognition that these are historic times for the industry. Newspapers across the country have resorted to layoffs, pay cuts, furloughs and other cost-cutting moves to deal with a wounded business model and a recession-fueled drop in advertising. The Post-Intelligencer was converted to an Internet-only publication with a much-reduced staff, and The Seattle Times — the only mainstream daily left in the state’s largest city — has had severe financial troubles of its own and has cut 500 positions in the past year. Gov. Chris Gregoire called the decision to stop printing the 146-year-old P-I a “huge historical loss.” Gregoire said that while the tax break won’t cure all that ails newspapers, she felt the state needed to do something. “The industry has to right itself, and government can’t and won’t be a part of it righting itself,” she said. “But I don’t want government to be part of the reason that this industry can’t make it.” In May, the company that publishes The Columbian filed for Chapter 11 bankruptcy protection in an effort to resolve credit issues involving a building project. Publisher Frank Blethen said things have improved slightly for his newspaper since earlier this year, when he testified in support of the tax break and said that “we’re hanging on by our fingertips.” 
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