In this article, we will look into the most common questions you might have about our mobile taxes and fees that you will see on a regular monthly bill with us.
1. What are the most common taxes and fees I will see on my bill?
How it looks on your bill: E911 Tax (Wireless) / E911 Tax
Most states and localities collect a flat rate on a per line/activation basis for E911 services that range from about $0.50 - $3.00. If you see a second tax line item for E911 on your bill, then you may live in an area where a further tax is levied on that flat rate fee. There may be variations in that flat rate within a state, and certain jurisdictions levy other local emergency services fees.
On average, Ting customers pay about $0.79 in E911 taxes per month on a bill of about $30.
Where the tax is not a flat rate, states levy it on a percentage basis.
FCC Regulatory Fee
How it looks on your bill: FCC Regulatory Fee (Wireless)
These fees help to cover the cost of the FCC's enforcement and policy-making work. All wireless providers are required to remit these funds. This will range from about $0.02 - $0.06 per month on a bill of about $30.
Universal Service Fund (USF, USF Cellular)
How it looks on your bill: Fed USF Cellular / Fed Universal Service Fund / State Universal Service Fund
All carriers remit this fee, and it helps to fund the following:
- subsidizing service for high-cost areas to keep them affordable
- supporting telecommunications services to schools, libraries, and hospitals, especially in rural areas
In addition to the federal fee, some states also levy a USF fee.
Along with sales tax (we'll get to that), this fee represents a fairly large portion of the tax/surcharges (around 30% of the total amount taxed in many cases) with an average cost of $1.03 per month on a bill of about $30.
Federal Telecommunications Relay Services Fund
The Telecommunications Relay Service is a telephone service that allows persons with hearing or speech disabilities to place and receive telephone calls, typically via a text-to-voice service and an intermediary call center that the call goes through. This tax goes to the US Federal Government to pay for the service.
The FCC consumer guide also provides more information on this program.
State and Local Taxes
States and local governments levy a range of other taxes and fees including:
- Telecommunications Sales Tax
- Sales Tax
- Statutory Gross Receipts (Wireless)
- License Tax
- Utility Users Tax
Generally speaking, the Telecommunications Sales Tax, Sales Tax, Statutory Gross Receipts are all taxes on monies received for carrier services. On average, they will come to $0.96, $1.28 and $1.00, respectively, per month on a bill of about $30. While all of these can make up a fairly large portion of the tax/surcharges on a monthly bill (25-30% of the taxes and fees amount), the Telecommunications and Gross Receipts taxes are not widely levied.
License and Utility Users taxes are related to fees carriers remit for the use of utilities like cable, electricity, and others. Neither is widely levied but will, on average, come to $1.25 and $1.00, respectively, per month on a bill of about $30.
2. What other surcharges can I expect to see?
Certain states and local governments levy taxes and fees relating to specific public works or programs such as the Teleconnect Fund in California or the or Residential Service Protection Fund Surcharge in Oregon.
3. What fees won't I see on my bill?
Administrative or Recovery fees. We don't add any taxes or fees over and above the ones levied by federal, state and local government.
4. What about tax exemption?
We do not have a system or program in place to process purchases that are exempt from tax collection and remittance. Ting customers that are 501(c)3 organizations or that are otherwise tax exempt will need to submit individual claims for their purchases through the standard reimbursement means required by their state or local government (for example, Form AU-11 in New York or Form CDTFA-101 in California).
5. What about the tax on purchases?
One question we get is, "Why are you collecting sales tax on my online purchase?"
Good question. While we don't have physical stores in your state, we do provide services using the very physical infrastructure of our network provider in your state, and thus, we collect taxes on purchases.