Cities find new source of revenue: cellphone taxes

We’re going to go out on a limb and guess that you’re probably already not a fan of cellphone taxes, but the
New York Times had a little piece yesterday about how city governments with budget deficits are starting to pile on the
wireless sales taxes and levies in order to make up any revenue shortfalls. The average cellphone user already pays
about $8.75 a month in federal and state taxes, fees, and surcharges, but the Times notes how Baltimore, for example,
is adding an extra $3.50 per month onto the tabs of the city’s 238,000 wireless subscribers. Ironically it’s the
wireless carriers, which themselves have a shady history when it comes to tacking “miscellaneous” taxes and fees on to
their customers’ bills, that are leading the charge against cities and states collecting special taxes for wireless
service. They don’t like anything that makes wireless service more expensive, at least not when the money is going into
somebody else’s pocket, and so Cingular, Verizon, Sprint, and T-Mobile have filed a lawsuit against the city of
Baltimore (as well as Montgomery Country, which has its own wireless tax), arguing that the $3.50 fee is a sales tax
which the city does not have the authority to collect.



[Via The Wireless Weblog]











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