Cell Phone Companies Lobby to Freeze Taxes

A bill still must pass the Senate and be signed by the president, but the House approved current rates of 16.3% in taxes and fees have been frozen for five years. The bill includes a freeze on any new state and local taxes imposed on cellphones and other wireless services, including wireless broadband access.

New taxes on wireless mobile services have far outpaced average sales taxes on other items and have become a deterrent to the spread of wireless broadband technology. Taxes on wireless services hit 26.8% in Baltimore, 20.4% in New York City and 19.9% in Omaha, Neb. The bill prohibits state and local governments from imposing new discriminatory taxes on mobile services, providers, or property. Discriminatory taxes are defined as those not generally imposed on other types of services and providers.

“We need to encourage the development and adoption of wireless broadband, not tax it out of existence,” said Rep. Zoe Lofgren, D-Calif., the sponsor of the legislation,” according to USA Today.

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