As The Federal Excise Tax Fades Away, CTIA Fights For Additional Tax Relief

Washington, DC -- As wireless users across America wish the 108-year-old Federal Excise Tax (FET) a formal farewell, CTIA - The Wireless Association is setting its sights on additional tax relief for overburdened wireless consumers. The United States Treasury Department formally announced in May that the 3% monthly telecommunications charge that was first instituted to finance the Spanish American War would no longer be assessed on wireless users starting August 1st. The decision was a major victory for wireless consumers who had faced an average tax burden of roughly 17%.

"Wireless consumers are appreciative of the Treasury Department's decision and will certainly enjoy not having to pay the FET," said CTIA - The Wireless Association(R) President and CEO Steve Largent. "But we can't lose sight of the fact that wireless users are still paying roughly 14% of their monthly bill in taxes and fees. This is still an excessive burden that punishes hundreds of millions of Americans for choosing to make their lives more efficient and productive through the use of wireless technology. If policymakers want to ensure that high tech services like wireless are affordable for all consumers, then the issue of discriminatory taxation must be addressed. P> "This is one of the reasons why the Senate telecommunications legislation is so important," continued Largent. "In addition to calling for national consumer rules, the bill also establishes a three-year moratorium on state and local wireless taxes. This would be a huge win for our consumers if it's enacted."

Largent was referring to the Senate Communications, Consumers' Choice, and Broadband Deployment Act of 2006 which contains language that would prohibit state and local government entities from placing additional taxes on wireless service for a three-year period. CTIA has aggressively fought attempts by states and cities to impose new taxes on wireless service and is also engaged in an effort to repeal a 5% gross receipts tax on wireless in Pennsylvania. Largent indicated that if anything, the wireless trade association will become more aggressive in the wake of the FET repeal as it pursues policies that lessen the burden on wireless users.

"While the Senate bill is being debated, we fully intend to remain highly active in states and cities that seek to increase wireless taxes," said Largent. "The good news is that wireless users are now fully aware of how they are the targets of discriminatory taxation and are willing to contact their elected representatives to express their views. I firmly believe that this consumer pro-activeness will not only help move the Senate telecommunications bill along, but also serve as a deterrent to policymakers on the state and local level who are attempting to raise wireless taxes."

SOURCE: CTIA - The Wireless Association