News Regarding the Center
Phone Tax Laid to Rest at Age 108
New York Times
May 26, 2006
. . . Mr. Largent said 17 percent of the typical monthly cellular bill was made up
of taxes and fees.
Carriers, however, are partly to blame for that burden because they charge their
customers a range of discretionary fees to recoup their business costs. For
instance, some customers are charged "property tax allotment" fees that are meant to
pay for a company's real estate taxes. Other companies charge "carrier cost recovery
fees" to pay for the administrative costs of collecting taxes.
These fees generate billions of dollars in revenue for the companies.
That is a far cry from 1898, when the tax was first levied and there were 681,000
phone subscribers in the United States, according to James Katz, a
telecommunications historian at Rutgers University. Though relatively small in
numbers, those subscribers paid a considerable amount in taxes to help finance the
government's battle against Spain.
The annual basic charge for a home phone in the 1890's was about $100, or more than
$2,200 in today's dollars. A three-minute call from New York to Chicago in 1902 cost
$5.45 -- about $120 today.
|
