Petition to Repeal Double-Taxation of Cellphone Use

South Dakota, USA cell phone users declared a small victory as a petition was submitted yesterday with enough signatures to place a repeal of a double taxation of cell phone use on the November ballot. The tax in question is the Gross Receipts Tax (GRT), an additional 4% tax on cell phone service across the state. The GRT is in addition to the sales tax, doubling the tax burden imposed upon wireless services. The additional revenues collected from this tax do not even go to help fund wireless infrastructure or increase access to wireless technology.

"The gross receipts tax is unfair," said Mike Knuth, leader of the petition drive to put this measure on the ballot. "No one likes taxes and especially not hidden double taxation. I am glad the citizens of South Dakota will have the chance to repeal this tax."

"It is clear from our signature gathering that the people of South Dakota agree that this is an unfair tax," said Knuth. "We were able to get over 20,000 signatures in just a few weeks in support of this effort. People are tired of double taxation."

According to Knuth, this GRT makes South Dakota cell phone users among the highest taxed in the nation. The GRT adds an additional 4% tax burden to all cell phone services, pushing the average tax rate to almost 18% as a percentage of revenue. The 18% taxation rate approaches the level of the "sin" taxes imposed upon alcohol and tobacco, which are meant to discourage use of such products. As lawmakers continue to look for ways to ensure affordable access to such advanced communication services, an 18% rate of taxation does not help further that policy goal.

"Regressive, unfair, double-taxation, is not consistent with South Dakota values," said Knuth. "Not only is this tax unfair, but it does not even help provide better wireless infrastructure or access to South Dakotans. It's just a windfall for the government bureaucrats!"

"People are outraged and they are ready to repeal this tax," Knuth said. "This issue has already received tremendous support; we expect a vast majority of the 450,000 cell phone users in South Dakota to agree with our position."

Posted to the site on 3rd May 2006