A well-informed source in Telefonica acknowledges that the incumbent local phone company is ?seriously concerned? at the prospect of a law taxing the use of land and overhead space in São Paulo. It would have a negative affect on the telco?s finances, according to the source. The São Paulo City Council was due to vote on the bill late Thursday, June 26.
The source won?t say how big the financial impact would be, however. Equity analysts believe this would be a key number in forecasting the performance of Telefonica?s fixed-line operations in São Paulo State (Telesp Fixa). Management is trying to negotiate with the City Government ?in pursuit of a significant discount at the very least?, the source says.
A senior official of the City Government would neither confirm nor deny receiving any such request from Telefonica but told TELETIME News that ?it?s impracticable to make an exception by exempting any single company from taxes on the use of land or space?. In particular, said the official, the authorities are concerned about the proliferation of overhead wires and cables. They want to stimulate underground cabling, he said.
New taxes
