Since cell phones move, tax them
It appears that average wireless service nationwide have reached new highs rising above 16% as politicians look for something to maintain state and local coffers in a down economy. This is more than twice as high as the average rate of other consumption taxes and states like Nebraska, Washington, and New York top the list at around 23%. A proposed moratorium on new wireless taxes H.R 1521 was proposed in the last congress but have unfortunately failed to pass.
The tax revenues do pay for the services that all of us use, but it’s the disparity between the tax rates for different products and services that is a serious concern. Furthermore, it is a regressive tax that benefits well off rural Americans to the tune of $4 billion while lower income Americans get less than a $1 billion dollars in Universal Service Fund (USF) subsidies. As a matter of public policy, it seems like we want to promote the adoption of more wireless services including voice and data by keeping the taxes reasonable rather than taxing them like sins.
Since this appears to be a widespread problem, perhaps there needs to be some creative solutions. If a city or state taxes wireless services as sins, they are sending the signal that they don’t want these services to thrive. If that’s the case, then one could conclude that these cities and states with high wireless taxes must not need USF money to help expand wireless services.