High wireless phone taxes are an important factor behind the high prices consumers pay for their cell phone plans today, a new study shows.
(The Center Square) – Americans pay hundreds of dollars per year in taxes on their wireless “family plan” for their cell phones.
The Tax Foundation research shows the average American household with four phones would pay about $300 per year in taxes on a family plan costing $100 per month.
“Since 2012, the average charge from wireless providers decreased by 26 percent, from $47.00 per line per month to $34.56 per line,” the report said. “However, during this same time, wireless taxes, fees, and government surcharges increased from 17.2 percent to 24.5 percent of the average bill.”
According to the report, wireless phone customers paid about $12.6 billion in fees, government charges and taxes to local and state governments alone this year.
But less than half of that is attributable to generic taxes like sales tax. More than half is because of special taxes governments put on phone bills, taxes that are often unclear to consumers until after their purchase.
The Tax Foundation said those taxes hit poorer Americans even harder.
“Roughly 78 percent of low-income adults and 72 percent of all adults lived in wireless-only households. Wireless taxes are regressive and create significant burdens on low-income families.”
Originally published by The Center Square. Republished with permission.
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