Why We Need the Wireless Tax Fairness Act

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Wireless TaxFairness Act H.R. 1002 and S. 543


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Some states also double-tax consumers by imposing a gross receipts (GRT) or excise tax on wirelesscommunications in addition to the general sales tax.

Because discriminatory, new state and local taxes and fees on wireless services are typically regressive and significantly increase consumers cost of service the burden often falls especially hard onfixed-income users such as seniors, minority communities, working families and small businesses.

Too often, this hefty tax bite puts wireless services out of reach for far too many who have come to relyupon its value, convenience and safety as the preferred communications tool for their daily lives.

Consumers in 47 states and theDistrict of Columbia now pay wireless

taxes, fees and government chargesthat exceed the general retail salestax rate.

Wireless tax rates in many states (22of them and D.C.) have hit double digits,with some states (5 of them) breakingthe 20 percent mark in monthly taxesand fees when federal, state and localare combined.

NE WA NY FL IL

16% 7.4%

The average consumer pays 16.3percent of their wireless bill in combinedfederal, state and local taxes, fees andsurcharges each month.

For other goods and services, theaverage sales tax rate is only7.4 percent.

The effective rate of taxation on wireless services hasincreased three times faster than the rate on other taxablegoods and services between 2007 and 2010, resulting inbillions (the annual consumer tax burden is now about $21billion) in excessive tax costs for wireless consumers.

3x2007

2010

vs.W I RELESSTA X E S

GOODS &S E RV I C E S

Why we need the Wireless Tax Fairness Act

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The findings of the 2010 Wireless Tax Report by ScottMackey make it clear that imposing taxes on wirelessservices that are more than double what generalbusinesses pay should be considered discriminatory andexcessive, and must be addressed immediately. To thatend, Rep. Zoe Lofgren and I introduc[ed] the WirelessTax Fairness Act The legislation proposes to freeze

current tax structures on wireless services for 5-years,something that I believe will benefit consumers and helpto galvanize technological advancement in the long run.

Representative. Trent Franks

CONGRESSIONAL BUDGET OFFICE (CBO) COST ESTIMATEJuly 28, 2011Wireless Tax Fairness Act of 2011H.R. 1002 / S. 543

As ordered reported by the House Committee on the Judiciary on July 14, 2011

ESTIMATED COST TO THE FEDERAL GOVERNMENT:(The bills) would not assign any significant new responsibilities to any federal agencies,and CBO estimates that implementing the legislation would have no significant cost tothe federal government.

ESTIMATE IMPACT ON STATE, LOCAL, AND TRIBAL GOVERNMENTS:(The bills) would impose an intergovernmental mandate as defined in UMRA becauseit would preempt the authority of state and local governments to impose new taxes,or change existing taxes, on wireless services, providers, or property. (However) theauthority of state and local governments to impose or change taxes they broadly impose

on services, businesses, or property would be preserved under the bill. The bill alsowould not preempt the authority of governments to collect revenue from taxes onwireless services that have already been enacted and enforced. CBO did not identify anystate or local governments that planned to change or impose new wireless taxes in thenext five years; therefore, CBO estimates that the preemption would impose no cost on state, local, or tribal governments.

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Wireless Taxes and Fees 50 State Ranking - 201150 State Ranking Taxes and Fees on Wireless Service, July 2010, as Compared toGeneral Sales Tax Rate

Rank State Local Wireless

Rate

Local Sales

Tax Rate

Federal Rate

(USF)

Combined Rate

1 Nebraska 18.64% 7.00% 5.05% 23.69%

2 Washington 17.95% 9.00% 5.05% 23.00%

3 New York 17.78% 8.25% 5.05% 22.83%

4 Florida 16.57% 7.25% 5.05% 21.62%

5 Illinois 15.85% 9.00% 5.05% 20.90%

6 Rhode Island 14.62% 7.00% 5.05% 19.67%

7 Missouri 14.23% 7.23% 5.05% 19.28%

8 Pennsylvania 14.08% 7.00% 5.05% 19.13%9 Kansas 13.34% 8.13% 5.05% 18.39%

10 Texas 12.43% 8.25% 5.05% 17.48%

11 Maryland 12.23% 6.00% 5.05% 17.28%

12 Utah 12.16% 6.80% 5.05% 17.21%

13 South Dakota 12.02% 5.96% 5.05% 17.07%

14 Arizona 11.97% 7.20% 5.05% 17.02%

15 DC 11.58% 5.75% 5.05% 16.63%

16 Tennessee 11.58% 9.25% 5.05% 16.63%17 Arkansas 11.07% 8.38% 5.05% 16.12%

18 Oklahoma 10.74% 8.45% 5.05% 15.79%

19 North Dakota 10.68% 6.00% 5.05% 15.73%

20 California 10.67% 9.25% 5.05% 15.72%

21 New Mexico 10.52% 7.60% 5.05% 15.57%

22 Kentucky 10.42% 6.00% 5.05% 15.47%

23 Colorado 10.40% 7.56% 5.05% 15.45%

24 Indiana 9.84% 7.00% 5.05% 14.89%25 South Carolina 9.52% 7.25% 5.05% 14.57%

26 North Carolina 9.43% 7.75% 5.05% 14.48%

27 Minnesota 9.38% 7.71% 5.05% 14.43%

28 Mississippi 9.08% 7.00% 5.05% 14.13%

29 New Jersey 8.87% 7.00% 5.05% 13.92%

30 Georgia 8.57% 7.50% 5.05% 13.62%

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Rank State Local Wireless

Rate

Local Sales

Tax Rate

Federal Rate

(USF)

Combined Rate

31 Vermont 8.50% 6.50% 5.05% 13.55%

32 Wisconsin 8.34% 5.55% 5.05% 13.39%

33 New Hampshire 8.18% 0.00% 5.05% 13.23%

34 Ohio 7.95% 7.13% 5.05% 13.00%

35 Wyoming 7.94% 5.50% 5.05% 12.99%

36 Iowa 7.91% 6.50% 5.05% 12.96%

37 Massachusetts 7.81% 6.25% 5.05% 12.86%

38 Hawaii 7.75% 4.00% 5.05% 12.80%39 Alabama 7.45% 7.25% 5.05% 12.50%

40 Michigan 7.27% 6.00% 5.05% 12.32%

41 Maine 7.16% 5.00% 5.05% 12.21%

42 Connecticut 6.96% 6.00% 5.05% 12.01%

43 Alaska 6.69% 2.50% 5.05% 11.74%

44 Virginia 6.56% 5.00% 5.05% 11.61%

45 Louisiana 6.28% 9.00% 5.05% 11.33%

46 Delaware 6.25% 0.00% 5.05% 11.30%47 West Virginia 6.23% 6.00% 5.05% 11.28%

48 Montana 6.03% 0.00% 5.05% 11.08%

49 Idaho 2.20% 6.00% 5.05% 7.25%

50 Nevada 2.08% 7.91% 5.05% 7.13%

51 Oregon 1.81% 0.00% 5.05% 6.86%

US Simple Average 9.87% 6.38% 5.05% 14.92%

US Weighted Average 11.21% 7.42% 5.05% 16.26%

[For flat monthly taxes and fees, average monthly consumer bill is estimated at $48.16 per monthper CTIA - The Wireless Association.]

Source: Committee on State Taxation, 50-State Study and Report on TelecommunicationsTaxation, February 2011 by Scott Mackey, Kimbell Sherman Ellis LLP using statestatutes and regulations.

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Thomas A. Schatz

P re s iden t

1301 Pennsylvania Avenue, N.W.Suite 1075

Washington, D.C. 20004202-467-5300

November 1, 2011

U.S. House of RepresentativesWashington, D.C. 20515

Dear Representative,

You will soon vote on H.R. 1002, the Wireless Tax Fairness Act, which would place afive-year freeze on attempts by state and local governments to raise taxes on wireless services.On behalf of the more than one million members and supporters of the Council for CitizensAgainst Government Waste (CCAGW), I urge you to support this legislation.

In recent years, state and local taxes on wireless and mobile phone services haveskyrocketed. W ireless consumers pay an average of 16 percent in taxes on their wireless billsevery month, which is more than double the average tax rate of 7 percent for other general goodsand services in the United States. Wireless tax rates in some states have even risen above the 20percent mark, with customers in some localities subjected to rates well above 25 percent.

H.R. 1002 would prevent all state and local governments from imposing taxes on mobileservices, mobile service providers, or mobile service property, during the five-year periodcommencing after the date of enactment of the legislation. The ability to communicateefficiently and effectively through utilizing technologies such as wireless broadband and cellphones is an essential component to running a successful modern business, and should not behindered by onerous tax hikes.

With an ever increasing number of Americans relying on technology, lawmakers mustput an end to out-of-control increases in wireless taxes. I strongly urge you to support theWireless Tax Fairness Act. All votes on H.R. 1002 will be among those considered inCCA GWs 2011 Congressional Ratings.

Sincerely,

February 8, 2011

United States Congress

RE: Support Legislation Reducing State and Local Wireless Taxation

Dear Member of Congress:

I urge you to support any reintroduction of legislation to reduce the burden of stateand local wireless taxes. In the last Congress, the Cell Tax Fairness Act would haveplaced a mandatory five-year freeze on all new, discriminatory state and local wirelesstaxes. The bill received 198 cosponsors and was favorably reported out of a House

Judiciary Subcommittee. This year, I recommend Congress put its full support behinda similar measure to help relieve the growing burden that wireless taxes have placed on

American consumers and businesses.

As state and local governments around the country continue to push discriminatory,targeted taxes on wireless service for unrelated projects or to plug budget holes, afederal solution has become imperative. A mandatory freeze on wireless taxes is a pro-consumer, pro-business, anti-tax, and bipartisan solution to t his growing problem.

Today, over 290 million American wireless consumers are unfairly laden with excessivemonthly taxes, surcharges and fees for their cell phone service. The average cell phoneuser today pays approximately 16% in taxes every month, while wireless taxes haveskyrocketed to well over 20% in multiple states.

Nationally, these excessive taxes and fees cost w ireless consumers over $21 billionannually, making it more expensive to run a business and more difficult to maintain afamily budget. Almost 90% of Americans rely on cell phones, but discriminatory taxesand fees make wireless significantly less aff ordable for low-income families, rural

Americans, seniors, and small business owners.

With hundreds of separate local and state taxes, surcharges, and fees, the time hascome for policymakers to do the right thing on behalf of the American consumer. Wireless today doesn't recognize city and state borders, and the wireless consumershouldn't have to either. I strongly support legislation to provide a state and local taxfreeze for all wireless consumers.

Sincerely,

Grover NorquistPresident

Americans for Tax Reform

For Immediate Release Contact Steve Pociask November 1, 2011 (703) 471-3954

American Consumer Institute Applauds Passage of Wireless Tax Fairness Act Encourages Senate to take swift action to protect wireless consumers

WASHINGTON The U.S. House of Representatives today overwhelmingly approved the Wireless TaxFairness Act of 2011 legislation that will protect consumers with a five-year ban on new state and localgovernment-imposed wireless taxes and fees. The following quote should be attributed to Steve Pociask,

president of the American Consumer Institute Center for Citizen Research:

I applaud the House for moving forward with HR 1002, the Wireless Tax Fairness Act, to make sureAmericas consumers have a five-year reprieve from additional excessive state and local cell phone taxes.In some states, a quarter of monthly wireless service costs are due to state and local taxes and fees. Thesecell phone taxes are an increasingly troubling trend that adversely affect younger and lower-incomeAmericans.

Public policies need to stop taxing what we should be encouraging. High taxes on informationtechnologies stunts economic investment and impedes job creation, thereby hurting consumers and small

businesses. The American Consumer Institute looks forward to the Senate taking up this legislation quickly, passing it, and making sure American consumers have a wireless tax reprieve for the upcoming the holidayshopping season.

About ACI

The American Consumer Institute Center for Citizen Research is a 501(c)(3) nonprofit educational andresearch institute founded on the belief that consumers interests are not satisfactorily represented by thewide variety of advocacy and consumer organizations that often represent small subsets of consumers andspecial interests; ignore distant, collateral and unintended consequences of importance to consumers; andtoo often mirror advocates political views rather than an empirical analysis of consumers economicwelfare.

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Diverse Supporters Urge Congress to Act!

Citizens Against Go ernment WasteLetter to U.S. House of Representatives Supporting Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

With an ever increasing number of Americansrelying on technology, lawmakers must put an end toout-of-control increases in wireless taxes. I stronglyurge you to support the Wireless Tax Fairness Act. Allvotes on H.R. 1002 will be among those considered inCCAGWs 2011 Congressional Ratings.

American Consumer InstituteStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

Public policies need to stop taxing what weshould be encouraging. High taxes on informationtechnologies stunts economic investment andimpedes job creation, thereby hurting consumers andsmall businesses. The American Consumer Institutelooks forward to the Senate taking up this legislationquickly, passing it, and making sure Americanconsumers have a wireless tax reprieve for theupcoming the holiday shopping season.

Americans for Tax ReformLetter to Congress Supporting Passage of Wireless Tax Fairness Act FEBRUARy 8, 2011

With hundreds of separate local and state taxes,surcharges, and fees, the time has come forpolicymakers to do the right thing on behalf ofthe American consumer. Wireless today doesntrecognize city and state borders, and the wirelessconsumer shouldnt have to either. I strongly supportlegislation to provide a state and local tax freeze forall wireless consumers.

Digital LibertBlog post: House Passes Freeze on Excessive Wireless Taxes NOvEMBER 2, 2011

The Wireless Tax Fairness Act is a great stepforward in promoting innovation and affordability inthe wireless market. Many lawmakers tout the needto improve universal access to wireless service, andthe best way to do that is by reducing the tax burden.

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November 1, 2011

The Honorable Mitch McConnellSenate Minority Leader317 Russell Senate Office BuildingWashington, DC 20510

Dear Leader McConnell:

I write to inform you about an important piece of legislation that is scheduled for a vote onthe House floor today and should be brought up for a vote in the Senate as soon as possible.The Wireless Tax Fairness Act of 2011 (H.R. 1002 / S. 543) will ensure that wireless consumerscontinue to have access to the most revolutionary technologies by prohibiting states andlocalities from leveling new discriminatory taxes on mobile services.

I recently authored an op-ed in the Austin American-Statesman (please find a copy attached)where I discussed the benefits of this bill for minority communities in the United States. Asyou may know, around sixty percent of African Americans and Latinos are wireless Internetusers. These individuals are more likely to own a cell phone than non-Hispanic whites, andtend to take greater advantage of the technological and data functions these devices provide.

As an organization that promotes free enterprise, limited government, and individual liberty,we are proud to support legislation that limits harmful taxes and benefits consumers andsmall businesses like the Wireless Tax Fairness Act.

This bill will go a long way to ensuring continued access to mobile services for these groups.I thank you for your attention and respectfully urge you to bring this bill to the floor for avote as soon as possible.

For Liberty,

Mario H. LopezPresident

cc: Assistant Minority Leader Jon Kyl

November 3, 2011

The Honorable Max BaucusChairman Senate Finance Committee511 Hart Senate Office BuildingWashington, DC 20510

The Honorable Orrin HatchRanking Member Senate Finance Committee104 Hart Office BuildingWashington, DC 20510

RE: Wireless Tax Fairness ACT (H.R. 1002, S. 543)

Dear Chairman Baucus and Ranking Member Hatch,

Senator Ron Wyden and Senator Olympia Snowe have introduced (S. 543) in the Senate, and wesupport the passage of this important legislation. The Wireless Tax Fairness Act of 2011prohibits states or local governments from imposing any new discriminatory tax on mobile

services, mobile service providers, or mobile service property (i.e., cell phones) for five yearsafter the enactment of this Act. Similar legislation was passed b y the House on November 1, withbi-partisan support.

In The Hispanic Institutes publication, Hispanics and Broadband: Making the most of theMobile Connected Future, we document that Hispanics are more likely than Whites to access theInternet and e-mail on a mobile device. Hispanics are also more likely than Whites to have amobile Internet connection in lieu of a home broadband connection. High taxes on wirelessservices can keep these much needed technologies out of the hands of Hispanics and allAmericans alike.

The average wireless consumer pays over 16% in taxes on wireless services. This is nearlydouble the taxes on other goods and services. These taxes are of course regressive on minoritycommunities that shoulder most of the economic hardship. During this economic downturn,

policy makers in the nations capitol must focus on measures that alleviate economic burdens forall communities. The Wireless Tax Fairness ACT is a step in the right direction.

On behalf of The Board of Directors of The Hispanic Institute, I urge you to support thislegislation because it will benefit wireless consumers who are already paying more than doublethe national average sales tax rate for their cell phones service. Imposing taxes on wireless

FOR IMMEDIATE RELEASENovember 1, 2011

National Economist Issues Statement on Passage of Wireless Act

WASHINGTON Ev Ehrlich, President of ESC Company and former Under-Secretary of Commerce underPresident Clinton, released the following statement in response to the House vote today on the WirelessTax Fairness Act:

Todays House passage of the Wireless Tax Fairness Act shows that good ideas can still get bipartisansupport. Wireless services, including mobile broadband, are changing the way Americans work, earn,and live -- subjecting them to special and extraordinary taxes makes no sense. This is a good sign forthose of us who hope that the broadband environment can still attract level-headed, bipartisanthinking.

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The U.S. House of Representatives this evening will vote on the Wireless Tax Fairness Act,which would place a five-year moratorium on new taxes on mobile phones and otherwireless items. The measure enjoys broad bipartisan support and is expected to pass.

The following statements from tax and technology experts at The Heartland Institute afree-market think tank may be used for attribution. For more comments, refer to thecontact information below. To book a Heartland guest on your program, please contactTammy Nash at [email protected] and 312/377-4000. After regular business hours,contact Jim Lakely at [email protected] and 312/731-9364.

There is no legitimate reason that the combined tax rate on mobile devices should betwice as high as the tax on other goods and services. Protecting taxpayers from thesediscriminatory taxes for the next five years will help foster growth in an industry that is onthe front lines of innovation and job creation.

In particular, lower-income consumers will reap the biggest benefits and will be able toenjoy more access to wireless devices.

John Nothdurft Director of Government RelationsThe Heartland [email protected] 312/377-4000

A moratorium on wireless taxes is welcome, but a rollback wouldve been a moremeaningful method of putting money back into the pockets of consumers. If the nationalaverage state and local wireless tax is twice the national average state sales tax, it wouldmake sense to place an 8 percent or even lower cap on the amount of fees and taxescharged.

Bruce Edward Walker Managing Editor, InfoTech & Telecom News

Economist E EhrlichStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

Todays House passage of the Wireless Tax FairnessAct shows that good ideas can still get bipartisansupport. Wireless services, including mobilebroadband, are changing the way Americans work,earn, and live -- subjecting them to special andextraordinary taxes makes no sense. This is a goodsign for those of us who hope that the broadbandenvironment can still attract level-headed,bipartisan thinking.

Heartland InstituteStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

There is no legitimate reason that the combined taxrate on mobile devices should be twice as high as thetax on other goods and services. Protecting taxpayersfrom these discriminatory taxes for the next fiveyears will help foster growth in an industry that is onthe front lines of innovation and job creation.

In particular, lower-income consumers will reap thebiggest benefits and will be able to enjoy more accessto wireless devices.

Hispanic InstituteLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 3, 2011

On behalf of The Board of Directors of The HispanicInstitute, I urge you to support this legislationbecause it will benefit wireless consumers who arealready paying more than double the national averagesales tax rate for their cell phones ser vice. Imposingtaxes on wireless service that are more than thedouble what a general business pays must beconsidered discriminatory and should not be allowedto continue unchecked.

Hispanic Leadership FundLetter to Senator McConnell NOvEMBER 1, 2011

As an organization that promotes free enterprise,limited government, and individual liberty, we areproud to support legislation that limits harmful taxesand benefits consumers and small businesses likethe Wireless Tax Fairness Act.

This bill will go a long way to ensuring continuedaccess to mobile services for these groups. I thankyou for your attention and respectfully urge youto bring this bill to the floor for a vote as soon aspossible.

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Press Release For Immediate Release

FOR IMMEDIATE RELEASE

The Latino Coalition (TLC) applauds the U.S. House of Representatives for passing the 'Wireless Tax Fairness Act'

WASHINGTON, D.C. (November 2, 2011) - The Latino Coalition (TLC) applauds the U.S. Houseof Representatives for passing the 'Wireless Tax Fairness Act' earlier today. The legislationwould freeze all new state and local taxes and fees on wireless for a period of five years, andour membership of Latino-owned small business would surely benefit as a result.

The Hispanic population heavily relies on wireless technology to stay connected and to getahead. According to the Pew Internet & American Life Project, more than half of Hispanicsuse their cell phones to access the Internet and 44% own a smart phone (a higher percentagethan the rest of the general population). As it stands, the average American pays more than16% in monthly taxes and fees on their cell phone bills, so stopping the states and localitiesfrom piling on new taxes and fees is the right thing to do for consumers.

We applaud Representatives Zoe Lofgren (D-CA) and Trent Franks (R-AZ) for introducing thisbipartisan bill and for rallying their colleagues to strongly support it in the House. Now, weencourage the U.S. Senate to do the same to help our members who rely on their cell phonesto do business every day.

About the The Latino Coalition

The Latino Coalition (TLC) was founded in 1995 by a group of Hispanic business owners fromacross the country to research and develop policies relevant to Latinos. TLC is a non-profitnationwide organization with offices in Southern California, Washington D.C., andGuadalajara, Mexico. TLC was established to address policy issues that directly affect the well-being of Hispanics in the United States. TLC's agenda is to develop initiatives and partnershipsthat will foster economic equivalency and enhance overall business, economic and socialdevelopment of Latinos. Visit: www.thelatinocoalition.com .

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F or I m mediate Re lease Co ntact: Davi d H o ni gT h ur sday, Novemb er 3, 2011 P r es ident an d E xec uti v e D i r e c t o r

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MMTC ENDORSES WIRELESS TAX MORATORIUM

The Minority Media and Telecommunications Council (MMTC) encourages Congress to enact a five-year moratorium on new state and local taxes on wireless services, devices and broadband access.

This week, on a voice vote, the House approved the Wireless Fairness Act (H.R. 1002), which containsthe moratorium. Companion legislation (S. 543) is pending in the Senate.

Wireless broadband service is no longer a luxury it is a necessity for securing a good job, state of the arthealth care, a quality education, and an opportunity to participate in civic affairs.

African Americans and Latinos are leading the nation in wireless and smartphone usage, and theydisproportionately comprise the nations low-income population. When states and municipalities raise thetax burden on the most vulnerable Americans, the ability of these citizens to break the trajectory of

poverty by connecting to vital services and opportunities is more difficult, and the incentive to use broadband for these purposes is discouraged.

Some of the tax rates imposed by states and municipalities rival the sin taxes associated with liquor andtobacco. Wireless consumers pay an average of 16.3% in taxes and fees, which is more than double theaverage rate of 7.4 % on other goods and services.

As documented by the Joint Center for Political & Economic Studies earlier this week, wireless broadband usage rates are higher among African Americans (47%) and among Hispanic Americans(41%) than among White American (38%). The Joint Center also notes that wireless services taxes are a

barrier to wireless broadband adoption for low-income, low-wealth consumers with few other inexpensive broadband choices.

A five-year freeze on new state and local wireless taxes will do much to promote universal broadbandadoption and, thus, universal first class citizenship in the digital age. The need to clearly understand theunintended consequences of a regressive tax regime on minorities and the poor is essential for developinga more equitable tax structure on wireless services and digital goods.

* * * * *

ITIF Welcomes House Passage of WirelessTax Fairness ActPress Statement

For Immediate ReleaseFor More Information: Steve Norton (202) 626-5758 [email protected]

WASHINGTON (November 2, 2011)-ITIF President Robert Atkinson todayissued the following statement welcoming House passage by voice voteof a measure that would impose a five-year ban on discriminatory taxeson wireless services and devices by state and local governments:

"ITIF welcomes House passage of the Wireless Tax Fairness Act (HR1002). This is the wrong time to slap new taxes on one of the mostinnovative and fastest growing segments of the economy. The expansionof wireless services and development of new devices and applications hashelped create new businesses and stoked consumer demand for evenmore products and services. As I testified before the House JudiciaryAdministrative law Subcommittee in 2009 , taxes on wireless serviceswould stifle additional investment in wireless and broadband services anddrive prices up for consumers in a regressive way. Whatever revenueindividual state and local governments receive from these discriminatorytaxes in the short run, the nation as whole will be worse off in the longrun as productivity, economic activity and consumer choice is held back.

We hope the Senate moves quickly to advance this legislation toPresident Obama's desk."

About ITIF

The Information Technology and Innovation Foundation (ITIF) is aWashington, D.C.-based think tank at the cutting edge of designinginnovation strategies and technology policies to create economicopportunities and improve quality of life in the United States and aroundthe world. Founded in 2006, ITIF is a 501(c) 3 nonprofit, non-partisanorganization that documents the beneficial role technology plays in ourlives and provides pragmatic ideas for improving technology-drivenproductivity, boosting competitiveness, and meeting today's globalchallenges through innovation.

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HTTP APPLAUDS THE HOUSE ON PASSAGE OF THEWIRELESS TAX FAIRNESS ACT, CALLS FOR ACTION IN THE

SENATE TO PROTECT CONSUMERS FROM REGRESSIVEWIRELESS TAXES

November 4 th , 2011 (Washington, DC) The HTTP coalition applauds the House for bipartisan action in passage of legislation, which, if enacted into law, will protectconsumers from hikes in state and local taxes on wireless services a growing burdenon the mobile services that provide an affordable means of communication and accessto information for millions of families.

Latino communities rely on wireless devices more than other Americans. Hispanics aremore likely than Whites to access the Internet and e-mail on a mobile device. Hispanicsare also more likely than Whites to rely on a mobile Internet connection in lieu of ahome broadband connection. Burdensome local taxes raise the cost of theseservicesfor families already struggling through tough economic times. "Excessive wireless taxesare regressive. They hurt struggling families by driving up costs, and discourage use of mobile Internet and the mobile platform at a time when we are fighting to get Latinos,and all Americans online and using the Internet to enhance their lives," said BrentWilkes, National Executive Director, League of united Latin American Citizens(LULAC).

"Latinos have been particularly hard hit by the economic downturn. Barriers likeexcessive taxes, burdensome bureaucracy or arbitrary charges threaten to makewireless services that could assist in getting a job or starting a business unaffordable or out of reach, " said Lillian Rodrguez Lpez, President, Hispanic Federation.

"Raising the cost of wireless services places barriers to those already struggling tocatch up. We applaud the House for this pro-consumer and pro-Latino legislation," saidJose Marquez, President and CEO, Latinos in Information Sciences andTechnology Association (LISTA) .

HTTP calls on theSenate to take up and pass companion bill, S.543, introduced in theupper chamber by Senator Ron Wyden and Senator Olympia Snowe.

The average wireless consumer today pays over 16% in taxes on wireless services.This is nearly double the taxes on other goods and services, and regressive on minoritycommunities that already have higher rates of unemployment, and lost more householdwealth in the recent economic downturn. We encourage Congress to pass this measureto ease an increasing burden on services relied upon by families across the country.

Mobile devices provide a connection and information access point for poor families andthose already struggling economically. Adding multiple, discriminatory local taxes tothese services harms the affordability that makes the mobile platform such a lifeline for Latinos and others in hard times, said Jason A. Llorenz, HTTP Executive Director.

Minority Media and Telecom CouncilStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 3, 2011

Wireless broadband service is no longer a luxury itis a necessity for securing a good job, state of the arthealth care, a quality education, and an opportunity toparticipate in civic affairs.

Hispanic Technology andTelecommunications Partnership CoalitionStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 4, 2011

Excessive wireless taxes are regressive. Theyhurt struggling families by driving up costs, anddiscourage use of mobile Internet and the mobileplatform at a time when we are fighting to getLatinos, and all Americans online and using theInternet to enhance their lives.

Information Technologyand Inno ation FoundationStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 2, 2011

ITIF welcomes House passage of the Wireless TaxFairness Act (HR 1002). This is the wrong time to slapnew taxes on one of the most innovative and fastestgrowing segments of the economy. The expansion ofwireless services and development of new devicesand applications has helped create new businessesand stoked consumer demand for even moreproducts and services.

Latino CoalitionStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 2, 2011

The Hispanic population heavily relies on wirelesstechnology to stay connected and to get ahead.According to the Pew Internet & American LifeProject, more than half of Hispanics use theircell phones to access the Internet and 44% own asmart phone (a higher percentage than the rest ofthe general population). As it stands, the averageAmerican pays more than 16% in monthly taxes andfees on their cell phone bills, so stopping the statesand localities from piling on new taxes and fees is theright thing to do for consumers.

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NCL statement in support of the Wireless Tax Fairness Acthttp://www.nclnet.org/newsroom/press-releases/583-ncl-statement-in-support-of-the-wireless-tax-fairness-act/

National Consumers League November 4, 2011

Contact: NCL Communications, (202) 835-3323, [email protected]

Washington, DC-Sally Greenberg, Executive Director of the National Consumers League, issuedthis statement in support of the Wireless Tax Fairness Act HR 1002, which will be voted on bythe US House of Representatives this evening.

The National Consumers League supports HR 1002, the Wireless Tax Fairness Action of 2011, because it will slow the exploding number of taxes imposed on consumers and users of wireless phones and other services. Consumers in 46 states now pay wireless taxes, fees, and governmentcharges that exceed the retail sales tax rate.

For millions of Americans, cell phones have replaced landlines in providing phone services. Themillions of consumers who receive a cell phone bill each month- and many of these customersare middle and lower middle income Americans- with taxes imposed that they dont understand

in some states a gross receipts tax is imposed on top of a sales tax are paying taxes that addsignificantly to their overall bill. Unfortunately, without this legislation, there appears to be noend in sight; state and local governments will continue treat consumers who use wireless devicesas a cash cow for local projects.

The NCL understands that state and local governments need to raise revenues to pay for essentialservices fire and ambulance, schools and hospitals, roads and infrastructure -and we supporttheir right to do so through a democratic process, which includes the passage of tax laws that aresupported by the citizens. The ever-increasing taxes imposed on consumers who use wirelessservices are the wrong approach, however, and have reached unacceptable levels. This billsmoratorium will give state and local governments the opportunity to join with consumers andothers in an effort to reform communications taxes, an effort that is long overdue."

###

About the National Consumers League

The National Consumers League, founded in 1899, is America's pioneer consumer organization.Our mission is to protect and promote social and economic justice for consumers and workers inthe United States and abroad. For more information, visit www.nclnet.org.

National Black Chamber of Commerce1350 Connecticut Avenue NW Suite 405, Washington DC 20036

202-466-6888 202-466-4918fax www.nationalbcc.org [email protected]

November 7, 2011

Honorable Max BaucusChair, Senate Finance Committee219 Dirksen Senate Office BuildingWashington, DC 20510

Honorable Orrin HatchRanking Member, Senate Finance Committee219 Dirksen Senate Office BuildingWashington, DC 20510

Re: Taxation on Wireless Phone Calls

Dear Chair and Ranking Member:

The National Black Chamber of Commerce strongly supports the passage of the WirelessTax Fairness Act. This will help increase adoption of wireless services and technologiesamong our community and the greater public.

Part of our mission at the NBCC is to encourage African American communities throughentrepreneurship and capitalistic activity. Th e 21 st century ushered in a new type of

business. E-commerce dominates a part of the marketplace and smartphones now enablemore interaction and commercial opportunities than ever before.

Despite these great opportunities that mobile technologies and services provide, they are being hindered by excessive tax rates. While the average tax rate is around 7%, wirelessservices are taxed around 16%. This rate discrepancy is harmful to consumers.Many minority groups depend on their smartphones to access the Internet. Such a steeptax rate discourages use and makes it difficult for lower income families to afford theInternet and other mobile services. In order to encourage interaction in todays digitalworld, such crucial provisions must be affordable.

Wireless devices, applications and the platform that enables it all to happen are often keycomponents in running a business in todays world. Because the National Black Chamber

MyWireless.org Praises U.S. House of Representatives for Passing Historic, Pro-

Consumer Wireless Tax Fairness Act of 2011

FOR IMMEDIATE RELEASE: PRESS CONTACT: Tuesday, November 1, 2011 Brian Johnston, (202) 736-2980

WASHINGTON, D.C. National wireless consumer coalition MyWireless.org commends theU.S. House of Representatives for its unanimous approval of H.R. 1002, the bipartisan Lofgren-Franks Wireless Tax Fairness Act of 2011. Passed by a voice vote and backed by 236 co-sponsors, this pro-consumer legislation calls for a 5-year moratorium on all new, discriminatorystate and local wireless taxes and fees.

On behalf of wireless consumers shouldering a disproportionate monthly tax burden,MyWireless.org also expressed thanks to the timely leadership shown by all those Members whohelped make this day possible original sponsors Rep. Zoe Lofgren (D-CA) and Rep. TrentFranks (R-AZ); Judiciary Committee Chairman Lamar Smith (R-TX) and Ranking Member SteveCohen (D-TN); Speaker of the House John Boehner (R-OH) and Majority Leader Eric Cantor (R-VA); and House Minority Leader Nancy Pelosi (D-CA) and Minority Whip Steny Hoyer (D-MD).

Brian Johnston, Director of Advocacy for MyWireless.org, said, This legislation is a fantasticexample of lawmakers from both parties working together to address increasingly unfair efforts bystate and local governments to balance their books on the backs of wireless consumers. Onaverage, wireless consumers pay well more than their fair share of taxes and fees, and now theU.S. House has taken action to help them.

Johnston continued, We particularly want to thank Representatives Lofgren and Franks for their tireless work, as well as all of the bills co-sponsors for defending wireless users across thiscountry from more unfair, new state and local wireless taxation. Now its time for the Senate tostep up for consumers and del iver Wireless Tax Fairness.

A bipartisan Senate companion bill, S. 543, the Wyden-Snowe Wireless Tax Fairness Act, hasawaited consideration by the Senate Finance Committee since March 10 th of this year. Bothproposals address the excessive level of wireless taxes and fees on todays wireless user. Onaverage, the American wireless consumer now pays more than 16% on every monthly bill in

combined government taxes and fees more than double the average sales tax paid on other general goods and services. In fact, 47 states and the District of Columbia charge combinedmonthly wireless tax rates in excess of their sales tax rate, and the national consumer tax burdenannually has risen to $21 billion. Because discriminatory, new state and local taxes and fees onwireless services are typically regressive and significantly increase consumers cost of service the burden often falls especially hard on fixed-income users such as seniors, minoritycommunities, working families and small businesses.

2011 MyWireless.org national polling revealed 67% of consumers support a 5-year freeze f romCongress on all new state and local wireless taxes and fees, while 85% said wireless should betaxed at the same, or lower, rate as other general goods and services.

MyWireless.org is a nonpartisan non-profit national advocacy organization, made up of wirelessconsumers, businesses and community leaders from around the country, supporting reasonable

pro-consumer and pro-taxpayer wireless policies.

Mobile Future Statement onWireless Tax Fairness Act of 2011

WASHINGTON, D.C. The House today voted in favor of the Wireless Tax Fairness Act of 2011, prohibiting states or local governments from imposing any new discriminatory taxes on wireless services for five years after enactment.

The following statement should be attributed to Jonathan Spalter, chairman of Mobile Future:

We applaud Representatives Lofgren and Franks for introducing this important piece of legislation toprohibit new regressive taxes that could discourage consumer use of wireless technologies. Withwireless data traffic in North America expected to grow more than 20-fold from 2010 to 2015, it iscritical to foster an environment that promotes wireless usage and continued mobile innovation. Weapplaud the House for passing this bill today and urge the Senate to move this important legislationforward.

###

MyWirelessStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

We particularly want to thank RepresentativesLofgren and Franks for their tireless work, as wellas all of the bills co-sponsors for defending wirelessusers across this country from more unfair, newstate and local wireless taxation. Now its time for theSenate to step up for consumers and deliver WirelessTax Fairness.

Mobile FutureStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 3, 2011

We applaud Representatives Lofgren and Franksfor introducing this important piece of legislation toprohibit new regressive taxes that could discourageconsumer use of wireless technologies. With wirelessdata traffic in North America expected to grow morethan 20-fold from 2010 to 2015, it is critical to fosteran environment that promotes wireless usage andcontinued mobile innovation. We applaud the Housefor passing this bill today and urge the Senate tomove this important legislation forward.

National Black Chamber of CommerceLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 7, 2011

Despite these great opportunities that mobiletechnologies and services provide, they are beinghindered by excessive tax rates. While the averagetax rate is around 7%, wireless services are taxedaround 16%. This rate discrepancy is harmful toconsumers. Many minority groups depend on theirsmartphones to access the Internet. Such a steeptax rate discourages use and makes it dif ficult forlower income families to afford the Internet and othermobile services. In order to encourage interactionin todays digital world, such crucial provisionsmust be affordable.

National Consumers LeagueStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 4, 2011

The National Consumers League supports HR 1002,the Wireless Tax Fairness Action of 2011, because itwill slow the exploding number of taxes imposed onconsumers and users of wireless phones and otherservices. Consumers in 46 states now pay wirelesstaxes, fees, and government charges that exceed theretail sales tax rate.

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P.O. Box 7217 Denver, Colorado 80207-1217

Hon. Sharon Weston Broome (LA)National President

Executive Board:

National Vice PresidentSen. Arthenia Joyner (FL)

First Vice PresidentRep. Karen Yarborough (IL)

SecretaryRep. Sharon Beasley Teague(GA)

Corresponding Secretary Rep.Karen Camper (TN)

Treasurer Rep. Mia Jones (FL)

Financial SecretaryRep. Angela Williams (CO)

ChaplainRep. Earline Parmon (NC)

ParliamentarianRep. Laura Hall (AL)

HistorianHonorable Diana Bajoie (LA)

Immediate Past PresidentHonorable Margaret Carter

Regional Chairpersons:

National Regional Coordinator

Rep. Barbara Ballard (KS)Region 1Rep. Meshea Poore (WV)

Region 2Rep. Adrienne Jones (MD)

Region 3Sen. Mattie Hunter (IL)

Region 4Sen. Jackie Winters (OR)

National Executive Director Hon. Gloria Travis Tanner, CO(Retired)

Na t i o n a l Org a n i z a t i o n Of

FOR IMMEDIATE RELEASE

Comprehensive Reform of Wireless Taxation Needed Now By Sharon Weston Broome, NOBEL Women President

Regressive taxes threaten to undermine the advancements that minorities andwomen have made over the past several decades. There is still much moreprogress that needs to be done, and in our quest we must analyze and eliminatestructures in place that threaten to stifle and retard our growth.

The Joint Center for Political and Economic Studies released a paper this week,The Social Cost of Wireless T axation: Wireless Taxation and its Consequencesfor Minorities and the Poor, that implored local and state governments tocomprehensively reform taxes against wireless services, digital goods, and digitalservices.

Dr. Nicole Turner Lee, and Joseph Miller, authors of the paper shared recent dataon minority mobile broadband use and outlines our need to clearly understandthe unintended consequences of a regressive tax regime on minorities and thepoor is essential for developing a more equitable tax structure on wirelessservices and goods.

Lee and Miller also highlighted the two tax bills currently under consideration inCongress that would help prevent disproportionate harms to minorities and the

poor. The Wireless Tax Fairness Acts of 2011 (H.R . 1002 and S. 543) wouldput a 5-year moratorium on discriminatory taxes and fees. The Digital Goodsand Services Tax Fairness Acts of 2011 (H.R. 1860 and S. 971) would eliminateadditional taxes on the sale and purchase of goods electronically. The successfulpassage of both of these bills would help consumers as we experience the mostdifficult of economic times in our nations recent history.

We at NOBLE Women recognize that low income consumers, who aredisproportionately represented by African Americans and Latinos are among thehighest users of mobile devices. These devices serve as a tool to enhanceminorities education, healthcare, community engagement, family life andeconomic opportunities; however, the taxes imposed on these devices and theirapplications are regressive in nature and a barrier to improving our mostvulnerable citizens overall quality of life. We urge our colleagues to look beyond the benefit of imposing outdated regressive tax structures to bolsterrevenues for state governments and consider the social impact upon thecommunities we serve.

National Organization of Black ElectedLegislati e (NOBEL) WomenStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 1, 2011

Regressive taxes threaten to undermine theadvancements that minorities and women have madeover the past several decades. There is still muchmore progress that needs to be done, and in ourquest we must analyze and eliminate structures inplace that threaten to stifle and retard our growth.

Rainbow PUSHLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 1, 2011

We write in support of Senate bill S. 543 TheWireless Tax Fairness Act of 2011, which recentlypassed the House (H.R. 1002) with overwhelmingsupport and urge you to take immediate action in theSenate Finance Committee.

National Taxpayers UnionStatement on House Passage of Wireless Tax Fairness Act NOvEMBER 3, 2011

When it comes to emerging technologies likesmartphones, governments have often adopted not-too-smart tax policies. The Wireless Tax FairnessAct wisely puts the brakes on this burdensome andeconomically unproductive habit.

National Hispanic Caucusof State LegislatorsLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 29, 2011

NHCSL strongly endorses S. 543, the Wireless TaxFairness Act introduced by Sen. Ron Wyden (D-OR)and Sen. Olympia Snowe (R-ME) that will irrefutablyincrease economic innovation and digital literacy ofour states.

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March 15, 2011

The Honorable Ron WydenUnited States Senate223 Dirksen Senate Office BuildingWashington, D.C. 20510-3703Electronically Transmitted

Dear Senator Wyden:

The Small Business & Entrepreneurship Council (SBE Council) and its members across thenation appreciate and support your proposed Wireless Tax Fairness Act of 2011.

As you know, wireless mobile devices and services are used throughout our economy today,including by entrepreneurs, small businesses and their employees. For many businesses, this hasbecome a vital means for communicating and accessing the Internet.

Unfortunately, state and local governments have turned to wireless services and devices assources of increased revenue, with little consideration given to the economic and businessimplications. These taxes each well beyond the levels of taxation applied to other goods andservices.

In a report published last month in State Tax Notes , Scott Mackey, an economist and partner atKSE Partners LLP, compared and ranked wireless tax burdens among the states, including a

focus on the disparity between state and local taxes and fees on wireless service and general salestax rates. For the 50 states and District of Columbia, the average differential was 3.49%. Of course, the differential was particularly high in some states, with Nebraska having the highestdifferential at 11.64%, followed by New York at 9.53%, and Florida at 9.32%.

Put another way, the average state-local wireless tax rate was 55% higher than the averagegeneral sales tax rate.

These high taxes on wireless services raise costs for entrepreneurs and small businesses, and candiscourage investment in wireless infrastructure, with the negative consequences felt byentrepreneurial firms throughout the industry.

By prohibiting the states from imposing any new discriminatory taxes on wireless goods andservices for five years, your proposed legislation would bring about some much-needed certaintyby assuring that the wireless tax burden in the states will not get any worse.

Small Business Entrepreneurship CouncilLetter to Senator Ron Wyden MARCH 15, 2011

Wireless mobile devices and services areused throughout our economy today, includingby entrepreneurs, small businesses and theiremployees. For many businesses, this has becomea vital means for communicating and accessingthe Internet. Unfortunately, state and localgovernments have turned to wireless services anddevices as sources of increased revenue, with li ttleconsideration given to the economic and businessimplications. These taxes each well beyond the levelsof taxation applied to other goods and services.

SER-JobsLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 2, 2011

As more people rely on wireless services to accessthe Internet its imperative that all barriers to accesswireless services be lowered. In these troubledeconomic times, Congress should be searchingfor ways to alleviate the economic hardships forconsumers and this legislation does just that.

1424 K Street NW - Suite 401 - Washington, DC 20005 - Telephone (202) 842-1212 - Fax (202) 842-3221www.ushcc.com

EXECUTIVE COMMITTEE

Nina Vaca HumrichouseChairman of the Board

Jeanette Hernandez Prenger Vice Chair

Gabriel PascualSecretary

Mariano LegazFinance Chair

Javier PalomarezPresident & CEO

BOARD OF DIRECTORS

Region I

Martha Montoya *David LizarragaMariano Legaz

Region II

Don Salazar *Dr. Gilbert GarbisoMaria Sastre

Region III

Marc A. Rodriguez *

Jeanette Hernandez Prenger Nina Vaca HumrichouseRolando Pablos

Region IV

David Gomez *Juventino CanoRaymond Arroyo

Region V

Elizabeth C. Berman *Tony JimenezJose NioRuben Taborda

Region VI

Ignacio R. Veloz*Gabriel E. PascualElliott RiveraFrank Rodriguez

* Denotes Regional Chair

Hon. Max BaucusChair, Senate Committee on Finance511 Hart Senate Office Building

Washington, DC 20510

Hon. Orrin HatchRanking Member, Senate Committee on Finance104 Hart Senate Office Building 20510

November 2, 2011

RE: Wireless Tax Fairness ACT (H.R. 1002, S. 543)

Dear Chairman Baucus and Ranking Member Hatch,

On November 1 st the House of Representatives passed the Wireless Tax Fairness Act (HR 1002) with unanimous consent. The US Hispanic Chamber of Commerce is encouraged by this vote and strongly urges you and your colleagues in the Senate to act in similar fashion.

This much needed legislation will prevent state and local governments from raising taxes on wireless services for a five year timeframe. Wireless services are currently taxed, on averageat a rate of 16%, almost double the rate on other goods and services. This is a significanteconomic burden for consumers and business, especially when businesses are struggling togrow and create jobs. I find it especially troubling that these taxes disproportionately impact minority consumers.

The US Hispanic Chamber of Commerces mission is to strengthen and advance theeconomic interest for Hispanic firms across the country. As small businesses work throughthis economic downturn, its vital that policy makers in Washington remove regressive taxburdens and allow small businesses to focus on growth and job creation. The Wireless TaxFairness Act does just that by providing much needed certainty for businesses andconsumers.

Again, I strongly urge you to quickly move this much needed legislation through committeeand to a floor vote. This legislation has received bipartisan support and will help smallbusinesses across the country.

Sincerely,

Javier Palomarez President & CEO

United States Hispanic Chamber of Commerce

Taxpayers Protection AllianceBlog post: The Wireless Tax Fairness Act - Taxpayers and Consumers Win! NOvEMBER 1, 2011

Wireless taxes are not victimless. Individualssuffer. Businesses suffer. And, householdsstruggling to make ends meet suffer with taxincreases. The truth behind any tax increaseat the state and federal level is a function oflaziness. Instead of looking for ways to cutspending, states look for tax increase to payfor their excessive government. The House ofRepresentatives took an important step forwardin passing the Wireless Tax Fairness Act. This is atrue win for both taxpayers and consumers.

U.S. Hispanic Chamber of CommerceLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 2, 2011

This much needed legislation will prevent state andlocal governments from raising taxes on wirelessservices for a five year timeframe. Wireless servicesare currently taxed, on average at a rate of 16%,almost double the rate on other goods and services.This is a significant economic burden for consumersand business, especially when businesses arestruggling to grow and create jobs. I f ind it especiallytroubling that these taxes disproportionately impactminority consumers.

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House to Vote on Freezing Wireless Tax Rates

6:25 PM OCTOBER 31, 2011

Tomorrow, the House of Representatives is scheduled to vote on H.R. 1002, the Wireless Tax FairnessAct of 2011. H.R. 1002 would put a five-year moratorium on the taxes and fees charged to wirelessconsumers.

According to the findings, of the Cellular Telecommunications Industry Association (CTIA), the averagewireless consumer is charged more than 16% in taxes and fees while other taxable goods and servicesare only 7.4%. Additionally, 47 states along with the District of Columbia are charging wirelessconsumers more than other taxable goods and services. Five states, including Nebraska, Washington,New York, Florida and Illinois, charge more than 20%.

As a result, more than 140 Senators and Representatives have co-sponsored the Wireless Tax FairnessAct of 2011. This bipartisan legislation would put a five-year freeze on these taxes and fees. The freezewould allow wireless consumers some much needed relief during these challenging conditions and givetime for an examination into the discrepancy of wireless tax rates as compared to other goods andservices. Moreover, the freeze would not take away any existing revenue from state and localgovernments, but would give them time to reform their wireless tax policies.

If you are in favor of this legislation, please make your voice heard by contacting your Representativesand Senators. With the House voting tomorrow, be sure to voice your support for this bill toRepresentative of your Congressional district. Write your elected officials here .

U.S. Pan Asian American Chamber ofCommerceLetter to Chairman Baucus and Ranking Member Hatch NOvEMBER 8, 2011

We are encouraged by the action of the House ofRepresentatives to support small businesses andconsumers, and we look forward to your leadership inthe Senate on this important issue.

Women Impacting Public PolicyPublic Policy Statement Supporting Wireless Tax Fairness Act OCTOBER 31, 2011

This bipartisan legislation would put a five-yearfreeze on these taxes and fees. The freeze wouldallow wireless consumers some much needed reliefduring these challenging conditions and give timefor an examination into the discrepancy of wirelesstax rates as compared to other goods and services.Moreover, the freeze would not take away any existingrevenue from state and local governments, but wouldgive them time to reform their wireless tax policies.

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Joint Center Study

Such regressive taxation schemes also create a broadband adoption barrier for low-income individuals that have no other reliable way to go online. The higher total cost of service created by these taxes may causemany low-income consumers to either forego purchasing a mobile device and subscribing to a mobile servic eplan, or cancel their service upon discov ering the true cost of maintaining their serv ice.

While regressive state and local wireless taxation structures may appear to generate revenues to provideneeded services, these taxes also put mobile opportunities farther out of r each for those consumers whowould most benefit from wireless broadband. In the end, comprehensive and equitable tax policies areabsolutely critical for creating a mobile broadband environment that is more conducive to improvingconditions in low-income communities.

ABOUT THE JOINT CENTER FOR POLITICAL AND ECONOMIC STUDIES

The Joint Center for Political and Economic Studies is one of the nations leading research and public policyinstitutions and the only one whose work focuses primarily on issues of particular concern to AfricanAmericans and other people of color. To learn more, please visit www.jointcenter.org . Founded in 2008 andfully launched last year, the Media and Technology Institute (M TI) focuses on how the media industry andemerging communications technologies can become avenues of advancement for people of color. MTIresearch is focused on technologies related to new media; trends of digital convergence and the implicationsacross various innovation sectors (e.g., energy, health care and open government); the impact of existing andfuture policies and regulations for the telecommunications and media industries; and, broader implications of media trends, including private equity ownership, participation, access and coverage of minorities. TheMedia and Technology Institute was the first to publish empirical research on minority Internet profiles that has been widely cited and quoted by government, industry, and advocacy organizations.

The Social Cost of Wireless Taxation: Wireless Taxation and its Consequences for Min orities and the PoorBy Nicol E. Turner-Lee and Joseph S. MillerOctober 31, 2011

EXECUTIVE SUMMARY:

Continual increases in state and local taxes of mobile service, digital goods, and digital services harm theability of low-income communities to realize the full benefits of mobile broadband and create deeplytroubling consequences for minorities and the poor. Understandably, the enormous growth of the mobilebroadband and applications markets makes the consumer costs of wireless service, digital goods, a nd digitalservices tempting potential tax bases for struggling state and local governments. However, more taxincreases on mobile service and the purchase of digital g oods and services would perpetuate a regressive taxregime. Left unchecked, this tax structure will continue to harm low-income consumers who stand to gain themost from the potential of wireless broadband to lower their cost of living while improving their prospects inhealthcare, employment, and other areas.

Recent data shows that people of color and low-income individuals are the most avid users of mobile devices.These consumers are therefore in a position to benefit from the lower prices offered via the Internet.Unfortunately, they are also in a position to be disadvantaged by higher taxes on mobile services, digitalgoods, and digital services. M oreover, raising taxes on wireless services, digital goods, and digital servicescould potentially thwart behaviors policymakers and others seek to encourage, such as increased broadbandadoption rates among minorities and the poor.

Under consideration in the U.S. Congress are two billsthe Wireless Tax Fairness Act of 2011 (H.R. 1002 andS. 543) (WTFA) and the Digital Goods and Services Tax Fairness Act of 2011 ( H.R. 1860 and S. 971) (DGSTFA),which would help prevent disproportionate harms to minorities and the poor. The WTFA would impose afive year moratorium on new discriminatory (i.e. higher) wireless service taxes, as compared to state andlocal sales taxes on goods and services purchased offline. The DGSTFA would prohibit state and localgovernments from imposing multiple or discriminatory taxes on digital goods and digital services, ascompared to state and local taxes on tangible goods and services purchased offline. These bills would givestate and local governments the opportunity to update their tax laws and, most importantly, encourageconsumers to make full use of mobile broadband during these difficult economic times.

This paper presents an argument for why state and local governments should opt for comprehensive reformof taxes against wireless services, digital goods, and digital services and shares recent data on minoritymobile broadband use. In the end, the need to clearly understand the u nintended consequences of aregressive tax regime on minorities and the poor is essential for developing a more equitable tax structure onwireless services and digital goods.

While African-Americans and Latinos are leading the nation in wireless and smartphone usage, they

disproportionately comprise the nations low-income population. When states raise the tax burden on themost vulnerable Americans, the ability of these citizens to break the trajectory of poverty by connecting tovital services and opportunities is more difficult, and the i ncentive to use broadband for these purposes isdiminished.

While regressive state and local wireless taxation structures may appear to generate revenues to provide needed services, these taxes also put mobile opportunities farther out of reach for those consumers who would most benefit from wireless broadband. In the end comprehensive and equitable tax policies are absolutely critical for creating a mobile broadband environment that is more conductive to improving conditions in low-income properties.

Joint CenterThe Social Cost of Wireless Taxation:

Wireless Taxation and its Consequences for Minorities and the Poor

OCTOBER 31, 2011

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State Legislators Support End to Excessive,Discriminatory Taxes on Wireless Services.

76

Telecommunication, Science & TechnologyResolution TST-10-28

service so as to preserve this gateway to broadband access for seniors, Latinos, African-Americans, and allconstituents in our states; and

BE IT FURTHER RESOLVED, that the members of the NBCSL should evaluate their wireless tax structures in theirrespective states to insure that the economically disadvantaged who often use these services for Internet accessare not discriminated against through the assessment of excessive taxes and fees; and

NOW, BE IT FINALLY RESOLVED, that the NBCSL send a copy of this resolution to the President of the UnitedStates, members of Congress, members of the Federal Communications Commission, and State Legislatures andRegulatory agencies.

SPONSOR(S): Representative Joe Gibbons (FL)Committee of Jurisdiction: Telecommunications, Science and Technology Policy CommitteeCertified by Committee Chair: Senator A rthenia Joyner (FL)Ratified in Plenary Session: Ratification Date is December 4, 2009Ratification is certif ied by: Representative Calvin Smyre (GA), President

RESOLUTION TST-10- 8 n Telecommunication, Science & Technology75

Telecommunication, Science & TechnologyResolution TST-10-28

PROMOTING FAIRNESS IN THE TAXATION OF WIRELESS SERVICE

WHEREAS, the National Black Caucus of State Legislators (NBCSL) recognizes the integral role that wirelesscommunications services play in our society today, not only for voice communications but as a platform forbroadband Internet access; and

WHEREAS, the NBCSL believes that it is important to ensure that all communities have access to wirelesscommunications services; and

WHEREAS, the Pew Internet & American Life Project study published in March 2008 found that mobile accessbuilds on the cell phone, a device that is easier to use and more affordable than a computer and is a key platformfor on the go information access, and that cell phone users are more likely to be found in groups that havegenerally lagged in Internet adoption, such as senior citizens, blacks and Latinos; and

WHEREAS, the Pew study also showed that 56 percent of English-speaking Latinos and 50 percent of AfricanAmericans with cell phones, on a typical day do at least one of 10 non-voice data applications such as takingpictures, accessing the Internet for news, playing music, or text messaging, as compared with 38 percent of Caucasians; and

WHEREAS, a study on the Excessive Taxes and Fees on Wireless Service published in State Tax Notes inFebruary 2008 cites the national average rate of taxes and fees on wireless service as 15.19 percent as compared toa 7.07 percent average rate for general sales taxes; and

WHEREAS, the same study concludes that state and local taxes on wireless increased at a rate four times fasterthan the retail sales tax increase from the period 2003 to 2007; and

WHEREAS, an economic study by Ingraham and Sidak found that each additional $1.00 of tax on wireless serviceis estimated to decrease wi reless consumption overall by $1.23 to $1.29; and

WHEREAS, an economic study by Austan Goolsbee found that each additional $1.00 of tax on wireless servicesuppresses use of wireless data, including broadband Internet access, by an even greater amount , on averageabout $2.75; and

WHEREAS, the NBCSL recognizes that excessive and discriminatory taxes and fees on wireless communicationsservices can have a disproportionate impact on some constituents; and

WHEREAS, H.R. 1521, the Cell Tax Fairness Act of 2009, does not repeal existing state and local taxes but doespreclude states from targeting wireless consumers for additional excess taxes and therefore keeps broadbandaccess attainable at todays levels; and

NOW, THEREFORE BE IT RESOLVED, that the NBCSL supports the federal legislation H.R. 1521, The Cell TaxFairness Act of 2009, and urges Congress to pass it; and

BE IT FURTHER RESOLVED that the members of the NBCSL will promote studies in their respective states thatevaluate the tax and fee structure on wireless consumers and will work to ens ure the fair taxation of wireless

Telecommunication, Science & Technology n RESOLUTION TST-10- 8

National Black Caucus of State LegislatorsResolution Supporting Fairness in Taxation of

Wireless Services

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National Hispanic Caucus of State LegislatorsResolution Supporting Fairness in Taxation of

Wireless Services

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Supporters in the News

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Drop Taxes, Not Callshttp://progressivepolicy.org/drop-taxes-not-calls

Progressive Policy InstituteDiana CarewSeptember 30, 2011

Have you checked your wireless bill lately? Youll see a hefty set of extra taxes on mobileservicetaxes that are not imposed on any other good or service. These excise taxes represent atoll that state and local governments impose on their population of phone users. It is verytempting, at this time of tight budgets, to keep raising and raising the excise tax on wireless.After all, no one really wants to give up using their iPhone.

It is time to remove that temptation.

Congress is finally considering a bill that makes good economic and social sense the WirelessTax Fairness Act (WTFA). The WTFA will prohibit state and local governments from imposingany new discriminatory tax on or with respect to mobile services, mobile service providers, or mobile service property for five years from the date of its enactment. Currently, wireless taxrates average 16.3 percent nationally, two times the national sales tax rate, according to ScottMackey, an economist who works on wireless tax policy. These taxes are paid by us, 300 millioneveryday consumers, and each of us pays an average $7.84 a month in wireless taxes, fees, andgovernment surcharges.

Wireless taxes are a perfect example of how excise taxes can lead to distortions in the market,

hurting consumers. In fact, wireless taxes are more distortionary than other taxes, because of how narrow they are in scope, explicitly targeting wireless services (and therefore explicitlytargeting the people who rely on wireless services). Further, demand for wireless services have

been found to be rather sensitive to price, causing consumers to drop service as wireless taxescreep ever higher. This means that as taxes on wireless services increase, people will consumeless less of a service integral to everyday activities.

Worse, the market distortion caused by wireless taxes is particularly hard on poor and middle-income families. Studies by the Pew Foundation show wireless taxes are regressive in that theynegatively affect poor and middle-income families more than the wealthy, as poorer families relymore heavily on wireless services for internet and phone access. So, not only do wireless taxesimpose distortions on the entire population of wireless users, but they more negatively affect the

people who struggle the most to pay for it.

Wireless taxes, unlike other sin taxes on alcohol and cigarettes, are simply a means for statesand local governments to collect money for general funds with no other intended purpose. Inother words, states and local governments are not imposing wireless taxes as a way to encourageless wireless use. Yet that is exactly what wireless taxes do.

Dissenters say states and local governments wont be able to pay for basic public goods andservices if the WFTA goes into effect. They argue states need all the money they can get in these

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Texans burdened by high wireless taxeshttp://m.statesman.com/statesman/db_43077/contentdetail.htm?contentguid=QjF3es6l

Austin American Statesman

Mario LopezOctober 21, 2011

The nation's attention has recently been riveted on the congressional debate over how to reign inyears of out-of-control spending by Washington politicians that has resulted in a sky-high budgetdeficit. Though the recent debt-ceiling compromise was accomplished without levying more job-killing taxes, for several years, a key job-producing domestic industry has been quietly

bombarded with a steady barrage of tax increases, robbing consumers and hindering economic

growth.

Many Texans might not realize that a significant portion of their monthly wireless costs consistof various kinds of taxes and fees. A recent study by national tax policy expert Scott Mackeyreveals that for the average wireless customer, federal, state and local taxes, plus fees andsurcharges, make up about 16 percent of the total monthly bill. In Texas, consumers pay morethan 17 percent in wireless taxes, the 10th highest in the nation.

When you consider the average sales tax burden on other goods and services is barely above 7 percent, it becomes obvious that wireless customers are being overcharged. Some states evendouble-dip into consumers' pocketbooks by imposing sales taxes on top of other excise or grossreceipts taxes.

The effective tax rate on wireless services increased three times faster than the general sales taxrate between 2007 and 2010. This represents a huge drain on our economy and unfairness to allwireless consumers. Because they are avid users of handheld and other wireless devices,minority customers and minority-owned small businesses wind up paying some of the heaviest

bills.

Almost two-thirds of African Americans and Latinos are wireless Internet users. They are morelikely to own a cell phone than non-Hispanic whites, and tend to take greater advantage of thetechnological and data functions these devices provide. Wireless technology helps Texas' largeentrepreneurial Latino population bridge the digital divide that makes it more difficult for minorities to achieve economic success. Wireless services make it possible for small andminority-owned companies in Texas establish themselves online, grow their businesses andcompete in markets around the globe.

Data clearly show that Internet access leads to new jobs, new business opportunities and neweducation possibilities. And in these times of economic insecurity, broadband expansion is one

bright spot that would provide a much-needed boost to small business and job growth in Texascommunities. Small businesses in the Rio Grande Valley should have just as much access andopportunity as their counterparts in Austin, Houston and Dallas.

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Blacks Make the Cell Phone Businesshttp://www.blackvoicenews.com/commentary/more-commentary/46982-blacks-make-the-cell-

phone-business.html

Black Voices News

Harry AlfordOctober 27, 2011

(NNPA) Major wireless (cell phone) corporations should be conscious of the fact that much of their business and future depends heavily on the African American community. Fortunately,Verizon and AT&T understand this and are heavily involved in our community. T-Mobile will

become much better, if the merger with AT&T takes place (AT&T guarantees this). The others

should take serious notice with the latest studies now being released.

Wireless communication is an invaluable and increasingly necessary way to do business and stayconnected with friends, family, and our local communities. While it seems just about everyonehas a cell phone or smart phone these days, wireless use is especially prevalent within the Black community. According to Nielsen, African Americans talk and text on our cell phones more thanany other race or ethnicity in the country on average using 1,300 voice minutes and sendingabout 780 SMS (text) messages each month.

Were also increasingly leading the way in how the technology is used. The Pew ResearchCenters Internet & American Life Project was released this past August, and it shows AfricanAmericans use wireless more than any other ethnic group to access the Internet, send or receiveemail, play games, access social networking sites, post photos or videos online, and to bank online. We are also among the most likely to use our cell phones to download an app, play musicand participate in video calls and chats with our wireless device.

African Americans of all ages are clearly relying on wireless technology to improve their professional and personal lives, which leads me to an extremely perplexing question: If Black communities are using wireless as a lifeline to connect themselves and to improve our dailylives, then why is such a vital service taxed at such incredibly high (and still growing) rates inthis country?

The average American now pays more than 16 percent in combined monthly local, state andfederal wireless taxes and fees; and in this age of budget-strapped governments thirsty for revenue, there is a very real threat of that taxpayer burden going ever higher. Often, tax levies are

being heaped on us, per device which certainly adds up for families with children and seniorsrelying on them, as well as small business owners providing them for their employees. Theseregressive state and local wireless taxes across the board hit those on fixed incomes, such asseniors, small businesses and our minority community families the hardest. It makes no sense tome how we are discouraging the use of such an important tool by imposing a tax and fee burdenthats at this point more than double that which we pay, on average, in general sales tax (7

percent on average).

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The Wireless Tax Fairness Act Taxpayers and Consumers Win!http://www.protectingtaxpayers.org/index.php?home

Taxpayers Protection AllianceDavid Williams

November 1, 2011

Its not very frequently that the Taxpayers Protection Alliance (TPA) reports on a victory, butthis evening (November 1) was a banner moment for everyone that owns a cell phone. TheHouse of Representatives passed H.R. 1002, the Wireless Tax Fairness Act. This bi-partisan bill,with 236 co-sponsors, freezes all new state and local taxes and fees on wireless for 5 years. The

official scoring entity of Congress, the Congressional Budget Office (CBO), scored it as noadditional cost to any level of government. A true win!

Mobile devices are becoming a popular way to purchase books, music, or just download anycontent via the Internet. The Wireless Tax Fairness Act stops states and local governments fromimposing multiple or discriminatory taxes on these items.

Needless to say, wireless usage has skyrocketed over the years. There is an estimated 292million American wireless subscriber connections. With this spike in usage has come thetemptation of all levels of government to use it as a revenue source. In fact, 47 States and theDistrict of Columbia are going above and beyond the ridiculous by taxing consumers for wirelessabove the rate they pay for other general goods and services. According to Scott Mackey, an

economist and partner at KSE Partners LLP in Montpelier, Vermont Wireless users now face acombined federal, state, and local tax and fee burden of 16.3 percent, a rate two times higher than the average retail sales tax rate and the highest wireless rate since 2005. In total, theannual national consumer tax burden on wireless is $21 billion.

Wireless taxes are not victimless. Individuals suffer. Businesses suffer. And, householdsstruggling to make ends meet suffer with tax increases. The truth behind any tax increase at thestate and federal level is a function of laziness. Instead of looking for ways to cut spending,states look for tax increase to pay for their excessive government.

The House of Representatives took an important step forward in passing the Wireless TaxFairness Act. This is a true win for both taxpayers and consumers.

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Senators, please protect wireless consumershttp://dailycaller.com/2011/11/02/senators-please-protect-wireless-consumers/

The Daily Caller Scott Mackey

November 2, 2011

It should come as no surprise that Congress has a lot of work to do to restore the confidence of the American people in our economy and its management of the federal budget. Growth hasstalled, unemployment remains high and many Americans are concerned about making endsmeet. The last thing consumers need right now are excessive and targeted state and local taxes ontheir wireless service.

Wireless service has become a top target for government revenue collectors. In my latest study,Ive found that customers on average pay 16 percent of their wireless bill in federal, state andlocal taxes and fees more than twice the average sales tax rate. Unfortunately, this problem isgetting worse, not better.

From 2007 through 2010, the effective wireless tax rate grew three times faster than the tax ratesfor other goods and services. Consumers in 47 states now pay wireless taxes and fees that exceedthe general sales tax rate, treating wireless service like a luxury good even though it has

become a necessity for most consumers and is key to supporting small business growth andeconomic development.

Wireless and digital services facilitate everyday communication platforms like cell phones, theInternet and video, as well as more innovative services like medical monitoring and diagnostics

that rely on wireless networks. Over the last 10 years, these services have noticeably increasedour quality of life. Evolving technologies have essentially put computers in our pockets,

providing access to new services and applications whether at home or on the go. Prices on thesemobile devices have fallen due to competition and innovation, so now Americans across allsocioeconomic levels can afford them. Congress wisely chose to allow a dynamic, competitivewireless marketplace to develop over the last 20 years, and now consumers are reaping the

benefits.

These consumer benefits are threatened if we allow governments to impose excessive taxes andfees on wireless consumers. While some states have refrained from burdening consumers withnew taxes, continuing budget shortfalls at the state and local level make wireless consumers atempting target. Left unchecked, new wireless taxes could price out lower-income consumersfrom having wireless service altogether threatening to derail affordable communications for the very people and businesses that have come to rely on it and need it most during these tryingeconomic times.

Fortunately, there is legislation in Congress that would help stop new discriminatory taxes thatthreaten to make wireless service unaffordable around the country. On Tuesday, November 1, theU.S. House of Representatives overwhelmingly approved H.R. 1002, the Wireless Tax Fairness

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Our MissionMyWireless.org is a national nonpartisan non-profit consumer advocacy organization, giving morethan 300 million American wireless consumers a powerful and unified voice to protect the freedom,value, convenience and mobility they enjoy with wireless service. MyWireless.org brings togetherconsumers, their families and their businesses from across the country to protect their wireless rights

in their cities, states and nationally.

Protecting Our Wireless FreedomEvery day, millions of American consumers take advantage of wireless technology, and every day itbecomes more a part of our daily lives. Wireless keeps families and friends connected, helps businessdeals get done while improving work productivity, and even saves lives in case of emergency. Thefuture of wireless promises even more as communication, entertainment, business, speed andfunctionality converge. However, unfair and excessive taxes and regulations on wireless threaten theinnovation, value and choice wireless consumers enjoy today. Especially for those on fixed budgets

like seniors, working families and small businesses.More than 300 million Americans enjoy the personal freedom that wireless offers to them every day.The average wireless consumer today pays more than 16% in taxes and fees thats more than DOUBLEthe sales tax rate for most other goods and services. MyWireless.org gives those consumers a unifiedactivist voice to impact policies that affect them, and to protect the affordability and accessibility ofwireless for ALL Americans.

Fighting Excessive Taxes and Harmful Regulation

Wireless offers consumers more choice, value and innovative products and services, than ever before.But, unfair and excessive new taxes and regulations on wireless are threatening to decrease thoseconsumer benefits. Discriminatory wireless taxes and fees exceed 24% in some states, and furtherunchecked, taxes on wireless service will continue to increase much faster than taxes levied on othergoods and services. Complicated and costly regulations from government also raise prices and addhassles for consumers, without improving the quality and coverage of their service.

Since 2005, MyWireless.org has empowered more than one million consumer activists around thenation to help defeat unfair, new wireless taxes and regulations throughout the country. On behalf ofmore than 300 million customers, MyWireless.org will continue to educate consumers about harmfulwireless taxes and fees in their cities, states and in Washington, D.C., and provide the online educationand outreach tools to make a difference with policymakers in protecting their wireless freedom.

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www.mywireless.org

Documents

Why We Need the Wireless Tax Fairness Act