Report: Republicans Grant Murdoch $63 Million Break For Sale
NEW YORK (AP) _ Rupert Murdoch could earn tax breaks worth $63 million for selling a Fox network station to minority owners, despite recent legislation eliminating such breaks, the Daily News reported today.
A House-Senate conference committee approved an exemption to the legislation after Republican leaders learned that Murdoch and House Speaker Newt Gingrich’s constituents near Atlanta would benefit, unidentified sources told the News.
Murdoch’s Fox TV group is selling Atlanta television station WATL for $150 million to Qwest, Inc., which is 55-percent owned by minorities including Quincy Jones, Geraldo Rivera, and former pro football star Willie Davis. The remaining 45 percent is held by the Tribune Co. of Chicago.
For the past 17 years, broadcast owners who sold to minorities received a significant tax break. In the new Republican Congress, however, Gingrich, R-Ga., and Senate majority leader Bob Dole, R-Kan., pushed a bill to cancel such breaks.
Sen. Carol Mosley Braun, D-Ill., offered a revision to the bill to let the tax break stand for Murdoch’s sale. She told the News that she acted on behalf of the Tribune Co., based in Illinois.
The tax break’s advantages would include allowing Murdoch to defer capital gains taxes indefinitely, an unidentified Senate staffer who attended the closed-door negotiations told the News.
The deal could not be independently verified by the Daily News. There was no comment from a Murdoch spokeswoman.
Qwest also benefits from the deal, paying $15 million less for the station than what Murdoch would have requested if he didn’t receive the tax break.
Murdoch has been connected to Gingrich in an ongoing ethics controversy. Gingrich reportedly met with Murdoch while negotiating a million-dollar book deal from HarperCollins, which Murdoch owns.
Gingrich later returned the advance offered by the publisher but will still collect royalties on the book.
Murdoch also has been exempted from federal regulations forbidding one party from holding television stations and newspapers in the same market. Murdoch owns the New York Post and Fox5-TV in New York City.