Taxes, Fees and Government Mandates
Cell Tax Fairness Act
Hundreds of separate sets of state and local wireless taxes and fees across the country increase consumer costs, and threaten to delay wireless innovation and reduce consumer choice. States and cities are all too often raising the cost of your monthly wireless service by imposing new discriminatory taxes and fees. America's more than 257 million wireless consumers overwhelmingly support Congress passing legislation - Congresswoman Lofgren and Congressman Cannon introduced H.R. 5793, the Lofgren-Cannon "Cell Tax Fairness Act of 2008" and Senator Wyden and Senator Snowe recently introduced S. 3249, the bipartisan Wyden-Snowe "Mobile Wireless Tax Fairness Act" – both of which place a five-year hiatus on new unfair state and local wireless taxes. Currently, the average consumer pays over 15% in taxes on their monthly bill, and in a recent consumer survey, 85% of consumers supported this vacation from excessive new taxation. You can help today by urging your U.S. Representative and your Senators in Washington to support H.R. 5793, the Lofgren-Cannon "Cell Tax Fairness Act of 2008," and S. 3249, the Wyden-Snowe "Mobile Wireless Tax Fairness Act" , both of which will place a five-year freeze on new discriminatory state and local wireless taxes.
Read More.
Permanent Internet Tax Freedom Act
The existing Federal moratorium on taxes on Internet access was set to expire on November 1, 2007, and tens of thousands of wireless consumers across the country took action. Legislation was recently passed in the U.S. Congress – and signed into law by the President – to avoid the expiration of the Internet tax moratorium by extending the ban through the year 2014. Passage of a permanent ban on Internet Access Taxes remains the overwhelming goal of wireless and wireless Internet consumers -- over 71% said so -- however this action was the critical first step needed to ensure that the Internet is not subject to new state and local taxation that would limit consumer choice, delay innovation, and often require consumers to pay more for service. Since 1998, Congress has determined that Internet access should not be subject to state or local taxes, and also that electronic commerce should not be subject to unfair and discriminatory taxes. Congress should protect American consumers, and share in a bi-partisan goal of expanding affordable Internet access to all Americans. You can say thank you to your U.S. Representative and Senators today! Read More.
10 Worst Wireless Tax States
When your wireless bill comes every month, do you ever look at all the taxes
you’re paying? Innovation and competition in the wireless industry has pushed
prices down over the years. But taxes imposed by every level of government –
from your city to the federal government – are eating up your savings and threatening
to limit your freedom to communicate affordably.
Some states are worse than others when it comes to how much they tax wireless
consumers. Below is a ranking of the top 10 states in which wireless consumers are paying the most taxes and fees for their service.
What would you tell policymakers who propose new wireless taxes?
| State-Local | Total | |
| Nebraska | 18.35% | 22.54% |
| Washington | 16.43% | 20.62% |
| Florida | 16.23% | 20.42% |
| New York | 15.96% | 20.13% |
| Missouri | 15.73% | 19.92% |
| Rhode Island | 14.52% | 18.71% |
| Texas | 14.27% | 18.46% |
| Pennsylvania | 13.50% | 17.69% |
| Illinois | 12.75% | 16.94% |
| California | 12.67% | 16.86% |
Source: Scott Mackey (Partner: Kimbell, Sherman, Ellis)
* Note: As of October 2006, the FCC adjusted the safe harbor assumption from 28.5% to 37.1%. On a quarterly basis, the FCC adopts adjusted contribution factors. Thus, the above reflects the effective federal USF contribution rate as of July 1, 2007.
Click here to view the full list of 50 States.
Click here for more information on federal, state, and local wireless taxes.
Did You Know?
Wireless costs have dropped nearly 80% over the last 10 years, but the typical wireless consumer now faces over 14% in taxes on their wireless service, more than twice the average tax rate for other goods and services. Unfortunately, the wireless tax man is picking up steam…Between January 2003 to April 2004 the tax rate on wireless services increased at nine times the rate of other goods and services. In some areas, the wireless tax rates top “sin taxes” on things like tobacco and alcohol. And some legislators want to tax wireless even more!
Besides socking your pocketbook, taxes on wireless services actually slow down improvements in your coverage and quality of wireless service. Did you know that the more money a wireless company invests in improving your wireless services, the more they get taxed? What sense does that make?
Who Really Pays?
Higher wireless taxes force families on smaller budgets to make hard choices about whether they can afford the personal freedom, safety and security that come with wireless technology – and too often the answer is no. In places like Florida or New York where wireless taxes are highest, this means that taxes reduce the affordability and availability of wireless technology by about 20%. That means Americans on limited budgets may not be able to afford wireless phones for their kids, elder parents, or family members who could benefit from the safety and mobility wireless technology provides.
Dragging Down the Economy
If you think heavy taxes weigh you down, think about how they dampen the U.S. economy. Economists estimate that a 1% decrease in wireless prices would increase U.S. Gross Domestic Product by between $6.8 billion and $7.8 billion within two years. That’s a multi-billion dollar shot in the arm for the U.S. economy.
Show Me The Money
In too many cases, your local or state government will raise your wireless taxes for a particular purpose – say, improving 9-1-1 safety systems – and then use the money for something totally different. Take a look at the 9-1-1 fee you pay every month on your wireless bill. Those taxes were supposed to improve emergency services when you use your wireless phone to call for help. Unfortunately, in some states these funds ended up paying for things like dry cleaning and office furniture.
Enough Is Enough
So, ready to help stop the avalanche of wireless taxes? You can make a difference by taking a stand against excessive and unfair taxation on your wireless services. Protect your wireless freedom, by keeping it affordable and accessible for everyone.
Join MyWireless and let your voice be heard.
