Tuesday, January 17, 2006

Chuck Schumer discovers the telephone tax.

The IRS is illegally collecting taxes from cellphone users to the tune of $9 billion over of the last three years, Sen. Charles Schumer said yesterday. Of that, New York City residents are owed $275 million — about $50 per customer, Schumer said.

The federal government started collecting taxes on long-distance calls way back in 1898 to help pay for the Spanish American War.

But several courts have recently ruled that the tax — which is 3 percent of the total bill — does not apply to cellphones, since they are usually billed by the minute, not the distance.

"The courts have now made it crystal clear that this tax is illegal, and yet the IRS continues to put it on everybody's cellphone bill," Schumer said during a press conference at his Midtown office yesterday.

Earlier this month, a third federal appeals court in Washington, D.C., declared the tax "null and void."

"They're violating the law," he said. "The IRS asks all of us not to violate the law. Well, now we're asking them the same."
[NY Post]

Of course it's not just the tax on cell phones that's been ruled illegal, but that on almost all long distance service, as was explained here more than a year ago.

Well, with the politicians finally joining the party this blog will be the lone public voice on this issue no more. Good, my work here is about done.