Gordon Wants Congress To Repeal Outdated Phone Tax

Following the Internal Revenue Service’s
announcement to stop collecting the federal excise tax on long distance
phone calls, U.S. Rep. Bart Gordon is urging congressional leaders to take
up legislation that would eliminate the excise tax from all calls.
Last month, the IRS announced it would no longer collect the 3
percent tax on long distance phone calls.
“The federal telecommunications excise tax was originally
enacted to pay for the Spanish-American War,” said Gordon. “This tax
certainly has outlived its original purpose, and the time to permanently
repeal it is long overdue.
“The IRS did the right thing by eliminating the tax on long
distance phone services. Now, Congress needs to take the next step and
eliminate the tax from local phone bills as well.”
The tax first was levied in 1898 as a luxury tax for wealthy
Americans who could afford telephones. Since then, the tax has been
repealed and reinstated numerous times and became permanent in 1990.
Today (June 16), Gordon joined a bipartisan group of his
colleagues in sending a letter to the Speaker of the U.S. House of
Representatives expressing support for the Telephone Excise Tax Repeal Act
of 2005.
Gordon is a co-sponsor of the legislation, which would repeal the federal
excise tax on all calls.
“With more telephones than people in the United States today,
the (federal excise tax) now represents the polar opposite of a luxury tax,
and merely serves to raise prices for consumers,” wrote the House members.
Taxpayers will be able to file for refunds on their 2006 tax
returns for any long distance excise tax paid after February 28, 2003. More
information is available on www.irs.gov .