astro
January 16, 2006, 9:09pm
1
Interesting news item.
CELL TAX ILLEGAL
January 16, 2006 – 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.
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.”
Court rules federal excise tax on cell phones illegal
The federal government owes wireless phone subscribers about $9 billion in tax refunds for the 3% federal excise tax charged on their bills, which was ruled illegal by a federal court today; however, the paperwork is likely to put off most people from filing for the refund, according to USA TODAY.
All told, three federal appeals courts have ruled that the federal excise tax, which began as a levy to fund the Spanish-American war, could not apply to telephone calls which were charged only by time, and not by distance.
On Friday, a court in Washington, D.C., became the third federal appeals court since May to void the tax. Two other federal appeals courts, covering seven states, have ruled the tax unlawful, and cases are pending elsewhere in the nation’s 13 appeals courts. In all, nine federal courts have ruled that a 3% federal tax doesn’t apply to phone calls that are priced only by how long a person talks — not by how far the call travels.
That means cellular phones, Internet phone service and about one-third of long distance calls would be exempt from the tax. The wireless industry estimates that consumers would save about $4.5 billion a year. Taxpayers also would be due three years of refunds — about $9 billion.
The cellphone industry wants the tax removed immediately from bills and the money refunded. “Our customers shouldn’t be paying a tax that courts have repeatedly found illegal,” says Steve Largent, president of CTIA-The Wireless Association and a former Republican congressman. . . .
“It sounds absurd, but the law is written so that the government can keep collecting a tax even though it’s been ruled unlawful,” says Hank Levine, a lawyer representing businesses that challenged the tax. Federal law makes it nearly impossible to get an injunction to stop the government from collecting a tax, he says.
The average consumer would be entitled to a refund about the size of the average $49.52 monthly bill paid by the USA’s 195 million wireless subscribers. However, consumers would be required to seek refunds individually, documenting how much they paid each quarter in separate claims.
The time limit for refunds is three years. A person entitled to a $50 refund would have to fill out forms a dozen times to get the three years’ worth of refunds permitted under tax law. Collecting records and preparing the form would take about seven hours. — USA TODAY
Boy, they don’t make it easy, do they? It seems like the tax laws are written in such a way to make it nearly impossible to get your refunds.
And why are we still funding the Spanish-American war, anyway?
Otto
January 16, 2006, 11:18pm
3
You know those wily Spaniards, always up to some damn sneaky thing!
:::wonders when the first “Franco is still dead” joke will appear in this thread:::
I just checked. He’s still dead.
As R.A. Wilson thoughtfully pointed out, the laws are intentionally written to be vague so that the lawyers can prove one side if that’s what they’re asked to prove, but also the other side if they have to prove that . Ahh, beauracracy.
YaWanna
January 17, 2006, 12:39am
7
As in, “rule by Southern gentleman callers”?
Miller
January 17, 2006, 12:41am
8
E-Sabbath:
Who, the General?
No, the canned pasta magnate.
Bah, may Gaudere’s Law strike ye sevenfold.
E-Sabbath:
Who, the General?
Nah, Franco Harris. There’s a reason they called it the Immaculate Reception, after all.
E-Sabbath:
Who, the General?
No, James Franco, whose career sans Spiderman would be nothing.
Otto
January 17, 2006, 4:30am
12
Yeah, he’s had no sort of career outside of Spider-Man. Except for the 27 other acting credits and writing and directing two independent features, one of which he also executive produced.
But besides that, the guy’s got nothing.
Otto:
Yeah, he’s had no sort of career outside of Spider-Man. Except for the 27 other acting credits and writing and directing two independent features, one of which he also executive produced.
But besides that, the guy’s got nothing.
Oh, step off. I was teasing. I read that page before I posted and am well aware of his accomplishments. Your pardon, please, for besmirching the poor guy’s name.
Ladies and Gentlemen, the horse is still dead.
Zebra
January 17, 2006, 5:08pm
15
ivylass:
Boy, they don’t make it easy, do they? It seems like the tax laws are written in such a way to make it nearly impossible to get your refunds.
And why are we still funding the Spanish-American war, anyway?
Because the cost of freedom is eternal vigilance.
You do like freedom, don’t you?
Otto
January 17, 2006, 6:14pm
16
I thought the cost of freedom was $2.99 for the first minute and $1.99 for each additional minute.
asterion:
Nah, Franco Harris.
No no no, Jess Franco. I mean, you can’t have enough movies about busty bimbos and the dark forces that menace them. And tear their clothes off. And stuff.
ivylass
January 17, 2006, 8:44pm
18
Not if I have to fill out forms in triplicate.
Boyardee? That’s not Spanish, is it?
