Wireless taxes, fees more than double goods and services, report says

A new report says that news taxes and fees are hitting wireless consumers especially hard.
The study, conducted by economist Scott Mackey and commissioned by the cellular industry, found wireless consumers pay a combined 15.2% in federal, state and local taxes and fees, more than twice the 7.1% rate imposed on other competitive goods and services that are taxed. In addition, the study – published in the periodical State Tax Notes – revealed taxes and fees on cellphone service increased four times fasers than taxes on other goods and services the past four years.
Mackey, whose clients include major cellular operators, said the benefit of the 2006 repeal of the 3% federal excise tax on wireless service has been short-lived and offset by new universal service fund charges and new levies on wireless service at the state and local levels. However, he noted consumer protests have helped to defeat or defer new tax proposals in Michigan, Oregon and Maryland.
Mackey, a former chief economist at the National Conference of State Legislators, pointed to a report in the January issue of Governing magazine that concluded excessive taxes on wireless and other communications services could be harming state economic development efforts by stifling investment in communications networks that contribute to business productivity.