California Scraps Text Tax

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California regulators dropped a plan to tax texts, citing a recent FCC ruling that limited states’ authority. The Commission voted last week to classify text messaging as an information, rather than a telecommunications service, Inside Towers reported.

The California Public Utilities Commission (CPUC) planned to vote on the text tax next month, but pulled it off the agenda after the FCC voted, reports Ars Technica

“Prior to this FCC ruling, text messaging was not a classified service under federal law,” said the CPUC in a statement. When proposed, the CPUC said the tax would help support communications services for low-income residents. It also noted telecommunications service revenue has dropped, as CPUC’s budget has increased.   

Instead of challenging the ruling in court, the state dropped the proposal. The previously proposed “text tax” faced opposition from carrier industry trade associations. “We hope that the CPUC recognizes that taxing text messages is bad for consumers,” said Jamie Hastings, CTIA SVP, External & State Affairs, after the FCC vote. “Consumers exchanged 1.77 trillion messages in 2017, making text messages one of the most common and effective means of communication for Americans. Taxing this service would burden those who rely on and use this service each and every day.”

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December 19, 2018               

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