Court Rulings May Spur End To 19th-Century Telecom Tax

[SOURCE: Technology Daily, AUTHOR: Drew Clark]
Nothing is certain but death and taxes, but what of the death of taxes? The 3 percent excise tax, which is charged on all phone bills, was first imposed in 1898 as a temporary, "luxury" tax meant to fund the Spanish-American War. Congress passed language to repeal the tax in 2000, but President Clinton vetoed a broader budget measure containing the repeal provision. The IRS continues to assess and collect the even though it has been overturned by three courts within the past eight months. What can kill the beast? Americans for Tax Reform, an anti-tax group influential in the Bush administration, is spearheading a coalition opposed to the tax. The group's members include the U.S. Telecom Association, the wireless group CTIA, the Communications Workers of America, and the 60 Plus Association of senior citizens. "If you look at the telecommunications industry, they are only third in line [in taxes] behind alcohol and tobacco," said Tom Readmond of Americans for Tax Reform. "That level of taxation tends to hold technology back."
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