TIA Calls for Tax Emption for BEAD Grants

WASHINGTON, Feb. 24, 2025 – The Telecommunications Industry Association urged the Trump Administration to work with Congress to exclude certain broadband grants from federal corporate income taxes in a letter congratulating Howard Lutnick on his Senate confirmation as Secretary of Commerce.

In last week’s letter, the association outlined some of its priorities for the year and asked Lutnick to address them so that the $42.45 billion Broadband Equity, Access, and Deployment program can be continued and implemented quickly.

Among those priorities was ensuring that BEAD grants were not categorized as taxable income. Broadband grants are currently subject to the 21% federal corporate income tax, which some experts have argued dissuades Internet Service Providers from participating.

“[I]t is essential for the administration to work with Congress on enacting legislation that prevents federal broadband grants from being considered taxable income,” the letter read.

TIA warned that taxing BEAD grants would hurt the program and was not what Congress originally intended.

“Congress never intended for BEAD grants to be subject to federal income tax, and treating these funds as taxable income could impede applicants' ability to apply and diminish the program's overall impact,” the association said.

When asked at his confirmation hearing by Sen. Jerry Moran, R-Kan., whether he supported excluding BEAD grants from the federal corporate income tax, Lutnick said the tax exemption “sounds entirely sensible.”

TIA, a non-profit global trade association, represents more than 400 companies in the telecommunications industry. Its mission is to enable high-speed networks and foster innovation in information and communications technology.

TIA also discussed the need to minimize tariffs’ effects on connectivity and consumer prices, reduce the risk of supply chain issues by maintaining beneficial relationships abroad, and increase network resiliency against cyberattacks.

The trade association did not comment on other key issues discussed during Lutnick’s confirmation hearing, such as already appropriated BEAD funds, fiber versus alternatives, or spectrum policy.