Americans for Tax Reform and Digital Liberty File Comments on 911 Taxes

Americans for Tax Reform and Digital Liberty released comments to the FCC Monday regarding Alabama’s E911 fee on no-charge Lifeline customers. ATR and Digital Liberty urge the FCC to oppose this improper regulation.

The federal Universal Service Fund (USF) connects low-income individuals to phone service and emergency services that they may not be able to access otherwise due to cost. This program is available for service provider to offer to low-income families and individuals. Alabama’s flat E911 fee to federally subsidize, free-of-charge customers is an example of abuse of the USF.

In this example, Tracfone’s SafeLink brand used the federal subsidy of $9.25 a month to provide a free phone and 250 minutes of free cell phone service in Alabama and in many other areas of the country. Before 2012, Alabama’s 911 districts imposed local 911 taxes on landlines that varied from $1.10 to $5.50 a month, plus a statewide tax on wireless phones of $0.70 a month. In 2012, those taxes were nixed in favor of a state wide E911 flat fee of $1.60 on all wireless and landline customers. As of August 1^st, the flat fee increased to $1.75. In addition to being a tax hike, Alabama extended the fee to federal no-charge Lifeline subscribers. Before 2012, the E911 fee did not apply to no-charge customers.

Rhode Island, South Carolina, Tennessee, Ohio, and California have already agrees that the 911 fees should not apply to Lifeline recipients. Alabama’s 911 board’s actions are misplaced and legislatively inconsistent with the goals of universal service. Grover Norquist of ATR and Katie McAuliffe of Digital Liberty stand against this tax increase.