With tax day fast approaching, the USA's Cellular Telecommunications & Internet Association (CTIA) finds that paying taxes won't end for wireless consumers after they file their paperwork with the feds. In light of the looming April 15th deadline, CTIA compiled a list of some of the most surprising taxes and tax proposals.
"There are more than 14,000 cities, counties, states, public utility commissions and other groups that have the legal authority to add taxes to wireless service," said Steve Largent, President and CEO of CTIA. "It seems more and more of these regulators are simply using wireless phone bills as a back door to tax increases. Every April, taxpayers have to declare how much we make, policymakers should be equally upfront about how much they spend and who has to pay."
Stealthiest Increase: Rhode Island wants to increase its monthly $1.00 E-911 surcharge to $1.26. But, experts say the current tax generates more than enough revenue to cover E-911 operations and improvements. So, why the increase? History offers a clue. In 2002, Rhode Island diverted $10 million from its E-911 fund to pay for other state programs.
Taking Liberties, Locally: In Maryland, Montgomery County already imposes a flat $2 monthly fee and Prince George's County imposes a 5 % tax on each wireless phone bill. Now, the city of Baltimore is proposing its own tax to help fund schools, and Anne Arundel County, Maryland wants a 5% wireless tax to fund public safety.
Worst Spin Award: Come November, California voters will see a ballot initiative that, if approved, will impose a 3% tax on wireless consumers to help hospitals meet rising emergency room costs. Less than 1% of the money raised would go to wireless E-911. A spokeswoman supporting the tax told the North County Times (CA), "Anybody who uses the phone could end up in the emergency room."
Put Another Log on the Fire: Governor Ed Rendell, as part of his "Plan for a New Pennsylvania" signed legislation that went into effect on January 1, 2004 that extended the state's gross receipts tax (GRT) to include in-state cellular phone calls and other telecommunications operations - a 5% tax increase estimated to cost consumers $235 million annually. Historically, gross receipts taxes are imposed on monopoly providers of utility services. Pennsylvania also charges a 6% sales and use tax on wireless consumers and a $1 surcharge on mobile phone users to fund E-911.
Longest Running Taxes: The 3% Federal Excise Tax was originally levied to fund the Spanish American War, which America won in 1898, yet we still pay it today. The National Taxpayers Union recently told RCR News, "Our researchers searched high and low, and could not find any bills still due from that war."
"We all support healthcare, schools and public safety, but wireless consumers should not pay for these services alone. Our public officials should balance their books openly and distribute the tax burden evenly, instead of burying these fees on wireless bills," added Largent.
CTIA is the international association for the wireless telecommunications industry, representing carriers, manufacturers and wireless Internet providers."
Posted to the site on 16th April 2004
Posted to: www.cellular-news.com/story/11015.php