Tax & Accounting Blog

Senate & House Considering Moratorium on Wireless Taxes

Indirect Tax, Sales and Use Tax March 29, 2011

A bipartisan bill introduced this month would institute a 5 year freeze on wireless taxes and fees. The Wireless Tax Fairness Act of 2011 would prohibit discriminatory state and local fees and taxes levied only on wireless services. Federal fees would not be affected by the bill. In a statement Senator Ron Wyden (D-OR), one of the sponsors of the bill, said ” Mobile web access is becoming as important to the lives of Americans as the Internet itself has become over the last 15 years.” The authors of the bill point out that the average wireless consumer pays more than 16% in fees for wireless services. That is far more that the average for most other goods and services which is around 7.4%. The taxes on wireless services are higher than many sin taxes. This is the third attempt by lawmakers in the last three years to limit wireless taxes. Similar bills died in Congress.

The current House bill (HR 1002) is currently in Committee on Courts, Commercial and Administrative Law. The Senate version ( S543) has been referred to the Committee on Finance.