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Attention Wireless Users: You’re Unfairly Taxed and Taxed More Than Ever

As reported this morning in Politico, Scott Mackey released his report on wireless taxes, fees and surcharges that shows wireless consumers pay the highest documented combined tax and fee burden EVER.

This is a truly troublesome trend, which is why we are advocating for the U.S. Senate to pass the Wireless Tax Fairness Act (S. 543). The U.S. House already passed the bipartisan bill last year, but we need the Senate to do the same so millions of wireless customers can get some much needed financial relief.

Consider the following:

  • 34 percent of U.S. households are wireless-only.
  • 26 percent of all users with download speeds of 3 Mbps and up are served by wireless broadband (page 14).
  • 83 percent of African Americans and 85 percent of Hispanics surveyed recently said they support the Wireless Tax Fairness Act, which would prohibit states and municipalities from raising taxes and fees on wireless service.

According to Scott Mackey’s report (from July 2011 to July 2012):

  • The average amount consumers pay in wireless taxes, fees and surcharges rose from $7.84 to $8.07 per line per month.
  • The average wireless user’s burden increased from 16.26 percent to 17.18 percent.
  • State and local wireless taxes and fees rose from 11.21 percent to 11.36 percent.

These may sound like “small increments,” but the average wireless customer is charged a rate of 2.5 times HIGHER than other taxable goods and services.

In 2011, there were:

  • 23 states that imposed taxes on wireless service in excess of 15 percent per line/per month.
  • 5 states above 20 percent per line/per month.
  • 46 states and the District of Columbia that imposed  local and state taxes and fees higher than those on other goods and services.

Unfortunately, this trend of disproportionately targeting wireless users for taxes and fees has not slowed down. In fact, there are even more states levying these taxes and fees against wireless consumers. In 2012, there are:

  • 28 states that impose taxes on wireless service in excess of 15 percent per line/per month.
  • 7 states above 20 percent per line/per month.
  • 46 states and the District of Columbia impose local and state taxes and fees higher than those on other goods and services.

With excessive taxes and fees putting undue pressure on low-income families, national organizations have pushed states to implement communications tax reform. While some states, including Delaware, Florida and Maryland, have made strides to reduce this burden, some states still levy taxes and fees far above the average sales tax.

The five highest wireless rates in the United States:

  1. Nebraska (24.49 percent)
  2. Washington (24.44 percent)
  3. New York (23.67 percent)
  4. Florida (22.41 percent)
  5. Illinois (21.76 percent)

To see your state’s tax and fee rate, please visit MyWireless.org. While you’re there, ask your Senator to support the Wireless Tax Fairness Act. By passing this bill, wireless consumers can get a five-year moratorium on any new wireless taxes and fees while state and local governments keep their revenue sources. The key is that they can’t levy any additional fees that are targeted against wireless users.

The Wireless Tax Fairness Act, with its bipartisan support, is important for our customers so they can get some much needed relief on these unfair taxes and fees. Please join me in contacting your U.S. Senator for their support of this important piece of legislation.

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