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The Longest War Ever?: The Fight to Repeal the Tax on
Talking
Henry Cabot Lodge, U.S. Senator from Massachusetts once said "The war
of the United States with Spain was very brief. Its results were many,
startling, and of world-wide meaning." Despite his Ph.D. in political
science from Harvard University, Senator Lodge could have never envisioned
one consequence in particular of the Spanish-American War, namely the
three percent Federal Telephone Tax. Now, over a century later, the "Tax
on Talking" continues to plague families in West Virginia and throughout
the United States. First created as a "temporary" tax in 1898 when there
were only 1,376 telephones and the telephone was still considered an
extravagance, this tax has outlived its purpose and needs to be repealed.
I am currently working on a bill in the Congress to put an end to the
three percent telephone tax.
Originally a form of excise tax targeted at a small, wealthy elite,
the telephone tax has now become an unfair, highly regressive tax that
disproportionally taxes low income Americans at a higher percentage. In
fact, it is estimated that families with less than $10,000 in annual
income would spend more than nine percent of their income on telephone
service. Meanwhile, families making $70,000 or more annually spend only
one percent of their income on telephone service. Although this tax is
labeled an excise tax, a form of tax that targets a specific group of
people, it really functions as a general revenue tax because virtually all
Americans subscribe to telephone service. Additionally, while many excise
taxes are designed to discourage certain behaviors, no rationale, other
than federal revenue needs, exists for the imposition of a tax on a
universal service like the telephone.
Another argument against the "Tax on Talking" can be found with regard
to the Internet. Because the Internet largely operates on the
telecommunications network, the telephone tax can also be seen as a
hindrance to the growth of the Internet. Placing an extra cost on
telephone use discourages not only the expansion and improvement of
telephone infrastructure, but also the technologies that build upon it.
While the Spanish-American War came to an end with the signing of the
Treaty of Peace in 1899, American citizens still find themselves fighting
an uphill battle to end the Federal Excise Tax on telephone service in the
21st Century. Rest assured that I will be working hard to provide the
extra push needed to pass this valuable piece of legislation and eliminate
the "Tax on Talking."
May 15, 2000 |
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