State and local taxes on wireless and mobile phone service have skyrocketed in recent years to an average of over 16 percent. In some places, the tax reaches over 25 percent. Aside fom being excessively high and discriminatory, in most cases the revenue goes directly into funds for pet projects or to help cover overspending addictions in state capitals.
Yesterday, a coalition of over 20 free-market groups announced their support of the Wireless Tax Fairness Act, which will help these curb state and local efforts to continually target mobile service for more revenue. The measure is under consideration by the House Judiciary Committee today and would place a five year freeze on efforts by state and local governments to raise taxes on wireless services. Already, the bill (H.R. 1002/S. 543) has the bipartisan support of over 245 Representatives and Senators, yet could face some limited opposition from revenue hungry state and local governments.
Check out a copy of the coalition's letter here (PDF) or below. Also, make sure to write your Representative and Senators urging them to support the bill.
RE: Support H.R. 1002/S. 543, Freezing State and Local Wireless Taxation
Dear Member of Congress:
We the undersigned groups – representing millions of Americans – urge you to support the Wireless Tax Fairness Act (H.R. 1002/S. 543) to put a five-year freeze on attempts by state and local governments to raise taxes on wireless services. Not only are wireless taxes already excessively high and discriminatory, but they also significantly restrain the growth and expansion of broadband.
Across the country, state and local governments are putting a substantial burden on consumers by raising discriminatory taxes on wireless services to fund special interest projects and cover up overspending addictions. Today, the average consumer pays upwards of 16 percent in taxes on their wireless bill every month. In some localities, wireless taxes have skyrocketed to well over 25 percent.
A federal solution to curbing wireless taxation has become imperative. The mandatory freeze on wireless taxes under H.R. 1002/S. 543 is a pro-consumer, pro-business, anti-tax, and bipartisan solution to this growing problem.
Nationally, these taxes on wireless cost consumers over $21 billion annually, making it more expensive to run a business and more difficult to maintain a household budget. Almost 90% of Americans rely on cell phones and a growing majority utilizes mobile broadband. Yet, all but three states tax wireless higher than they do the sale of general goods or services, and some states tax wireless despite having no sales tax on other goods or services. Taxes targeting wireless service make it significantly less affordable and inhibit universal adoption, especially for low-income families, small business owners, rural Americans, and seniors.
We urge you to support and co-sponsor H.R. 1002/S. 543 to freeze discriminatory increases in state and local wireless taxes. Wireless today doesn't recognize city and state borders, and the wireless consumer shouldn't have to either.
Americans for Tax Reform
Vice President of Government Affairs
National Taxpayers Union
Council for Citizens Against Government Waste
Vice President for Policy
Americans for Prosperity
Kelly William Cobb
Director, Small Business, Technology and Telecommunications
Washington Policy Center
Center for Individual Freedom
President & CEO
Small Business & Entrepreneurship Council
Indian American Conservative Council
Associate Director of Technology Studies
Competitive Enterprise Institute
Director, Telecommunications and Information Technology Task Force
American Legislative Exchange Council
Director, Tax and Fiscal Policy Task Force
American Legislative Exchange Council
60 Plus Association
Mario H. Lopez
Hispanic Leadership Fund
Dr. William Greene
Frontiers of Freedom
Smart Business Hawaii
Citizens for Limited Taxation