CTIA Asks Congress for Hiatus of Wireless Taxes

logo_ctia_main.gifCTIA, The Wireless Association and its member companies are urging Congress to pass legislation requiring a five-year hiatus on new discriminatory state and local wireless taxes. To achieve this goal, Representatives Zoe Lofgren (D-CA) and Chris Cannon (R-UT) introduced the “Cell Tax Fairness Act” today in the U.S. House of Representatives.

“The wireless sector of the technology industry continues to be an important driver for growth in our nation’s economy. Americans don’t just talk on their wireless phones anymore; they access the Internet, get information, pay bills and use wireless to be more productive at work and other every day activities, ” said Lowell McAdam, CTIA-The Wireless Association® Chairman and Verizon Wireless President and CEO. “With about 15 percent of each customer’s monthly bill already going to taxes and fees, increasing discriminatory and unfair taxes on wireless customers presents a clear and present danger to future growth. Policymakers should roll back taxes on wireless customers.”

According to analysis from a new study that examines trends of taxation on wireless service in the U.S., consumers continue to face a substantial, unfair tax burden, paying over twice the 7.1% rate imposed on other competitive goods and services subject to sales tax. Between 2003 and 2007, taxes and fees on wireless service increased four times faster than taxes on other goods and services.

“Keeping wireless taxes at a fair and reasonable level is critical to growing the economy and making the workforce more productive, efficient and informed,” said Steve Largent, CTIA-The Wireless Association® President and CEO. “We should do everything in our power to remove the roadblocks—such as excessive, discriminatory wireless taxes—that stand in the way of progress, and the Cell
Tax Fairness legislation introduced today in the House is a positive step in the right direction.”

The latest CTIA wireless industry survey released earlier this month revealed that as of year-end 2007 more than 255 million wireless users were recorded in the U.S., roughly 84% of the population. The survey also showed a dramatic increase in SMS, with more than 48 billion messages reported for the month of December 2007 alone—1.6 billion messages per day. This represents an increase of 157% over December 2006. Additionally, a March report issued by the Federal Communications Commission showed that in comparison to other platforms for high-speed internet service, mobile wireless comprised more than 68% of the overall growth in high-speed lines from June 2006 to June 2007.