
10 states with astronomical cellphone taxes
Nebraska tops the list, with total taxes of 23.69%. Oregon has the lowest rate, 1.81%.
Just how much do we love our cellphones? So much so that, in most places across the United State, we're willing to put up with astronomical taxes to stay connected.
An analysis of cellphone taxes by the Tax Foundation finds that the levies on the devices are significantly higher than many other common consumer items.
And while we tend to complain about the IRS, in this case the tax damage is more local.
The average U.S. wireless customer pays taxes and fees of 16.26%, says the Tax Foundation, with state-local charges accounting for 11.21% of that overall amount.
Worse, the Washington, D.C.-based tax research group found that state and local governments often hide or obscure the fees. In fact, my home state of Texas even sued Sprint because the company listed a state tax as a line-item in its bill, rather than hiding it from customers.
So where does your state rank on the cellphone tax list?
Nebraska is the biggest cell phone taxer. Its combined federal-state-local average tax rate is 23.69%. Four other states -- Florida, Illinois, New York and Washington -- have total cellphone tax rates of more than 20%.
Here are the top 10 highest cellphone taxing states, with their combined average federal, state and local cell phone tax rates:
- Nebraska, 23.69%
- Washington, 23%
- New York, 22.83%
- Florida, 21.62%
- Illinois, 20.90%
- Rhode Island, 19.67%
- Missouri, 19.28%
- Pennsylvania, 19.13%
- Kansas, 18.39%
- Texas, 17.48%
Overall, 23 states and the nation's capital have average state-local wireless taxes and fees in excess of 10%.
Locally, Baltimore, Md., imposes a $4 per line per month tax on wireless users. The Charm City assessment is on top of federal and state charges. The Washington, D.C., suburb of Montgomery County, Md., charges cellphone users a monthly $3.50 per line tax.
And where is making a mobile call not so costly? Head west, cellphone users.
Oregon's state and local tax rate is just 1.81%. Nevada's rate is 2.02%. In Idaho, cellphone users pay 2.20% in state and local taxes.
From those three low-tax states, the cellphone state and local rates jump to 6.03% (that's in Montana) and just keep climbing.
You can find cellphone tax rates for the 50 states and the nation's capital on page 2 of the Tax Foundation's report (.pdf format). There's also an online list where you can sort the cellphone tax data.
A confusing tax burden
"Cellphone users are overtaxed relative to consumers of other goods, and at risk of double taxation," writes study author and Tax Foundation Director of State Projects Joseph Henchman. "Additionally, the wide number of taxing authorities and the wide variety in rates makes tracking problematic and burdensome."
That burden is underscored by the ability of states to raise revenue with cellphone taxes in a relatively hidden way; note my earlier mention of sneaky and litigious Texas lawmakers.
Quick note to smartphone techie folks: I see plenty of apps for this and other state and local taxes.
Federal legislation has been regularly introduced in Congress to rein in the myriad cellphone taxes. It's usually titled something along the lines of the Cellphone Tax Moratorium Act. However, it's never moved very far in the legislative process.
If you have enough free minutes left on your cellphone plan, call your representative and senators and encourage them to finally do something about these taxes.
More from Don't Mess with Taxes and MSN Money:
Well it depends... if the taxes pertain to the monthly subscription fee and *not* where the actual calls originated, then yes. Here is something to sweeten the deal...
Use Google Voice. You can now transfer your existing cell phone number to them as if they were a cell phone provider. Google Voice allows you to forward all calls to any number you specify. The other features of Google Voice are all staggeringly impressive where call logging, call filtering, SMS messaging, and call screening are concerned. And best of all... Google Voice is completely *FREE* (last I checked anyway). Read entire comment for More details.
So buy your phone and service in another state; provided the service is good nationwide AND you have a legal address in that state you can use as the billing address (perhaps a P.O. box depending on the service, or a relative in that state). Transfer your existing cell number to Google Voice and then forward all calls to your new out of state phone. Everything works behind the scenes and is completely transparent to anyone who calls you.
No I don't represent Google in any official way, nor do I agree with all of their tactics or policies... but I'll use this service for this purpose for as long as it profits me to do so, and as long as I'm not breaking any state or federal law in doing so.
I was shocked, SHOCKED I tell you. Communications companies have been taken to task to make their billing easier to read, then Texas goes and sues Sprint for telling their customers exactly what kind of a royal you know what the state is doing to cell phone taxes.
Carolyn, I agree, we could all live without a cell phone, computer, TV, central air, running water and indoor plumbing. But no way am I going to move someplace where I have to use an outhouse! For most of us, we simply have to put a priority on some of life's nonessentials and forgo some luxuries.
WiseShopper: You have it completely wrong.
Televisions are measured in lines of resolution, like 1080 and 720. The measurement dpi is for printers, and stand for dots per inch.
720p, 1080i, and 1080p are ALL considered HD. Many TV programs are in 720p. Some are in 1080i.
There have been over-the-air broadcasts for HD for years. Buy an antenna. Or get cable.
People want the internet. People want cell phones. If they are willing to pay, then they are going to buy it. Don't like it? Tough.
Don't have any friends calling you on your cell phone? Tough.
According to you, any technology that is not NEEDED should not be purchased. This is not an opinion shared by the service-based economy we live in. Tough.
Now go eat your bologna sandwich, turn off all you lights, count the pennies you are saving every day by not having anything of a social life, and die.
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