This is the time of year when people shop for gifts in the malls, downtown shopping districts and on the Internet. They’re in spending mode, searching for the perfect gift for everyone on their list.
Many economists are
forecasting deep discounts for a variety of reasons, but the bottom line
is that it there will be a lot of bargains out there. I’m going to go
out on a limb and predict that a good many gift packages are going to
contain cell phones. Or as I like to call them, outboard brains.
with everything else in our great nation, there are taxes on cell
phones. Lots of them. Taxes that I guess most people are unaware of,
and if they even were, would likely not understand them without doing
travelers have become accustomed to unanticipated taxes. The kind you
see at airports and hotels, for example. You aren’t aware of them until
you get to the airport or check out of the hotel.
the financial services industry, I have to pay a licensing fee to each
state where I’m licensed. The licensing fees in most states are
generally around $50 to $100. And for the most part I have no objection
to such fees. I consider them to be reasonable.
state of Tennessee, however, is an exception. For the privilege of
buying a $50 state license, you have to pay a Tennessee privilege tax.
That means ponying up $500. Every year.
good news for Michigan residents is that, although we pay plenty of
taxes on cell phones, thirty-six other states pay more. We rank
thirty-seventh nationally, one of those rare circumstances where being
near the bottom of the list is a good thing.
total, the combined tax rate comes to 14.74 percent. The breakdown is
as follows: six percent sales tax; state wireless 911 comes in at .41
percent; county wireless is 1.45 percent; the Intrastate switched toll
restructuring statement -- whatever that is -- is a mere .43 percent;
and the Federal Universal Service Fund comes to a whopping 6.46 percent.
Check my math, but I’ve got the grand total at 14.74 percent.
If fifteen percent appears to be somewhat
excessive, be thankful you don’t live in the state of Washington. The
tax there is more than 25 percent.
don’t want to put a damper on giving cell phones as a gift, but they do
cost more to own than just the advertised price. And while I don’t
want to be a Scrooge either, I do want to point out that there’s a fine
line between being generous and putting your finances at risk. Not to
mention the gift recipient’s finances.
phones and tablets are certainly a part of our nation’s landscape.
But, they’re not inexpensive. And with all the taxes factored in, they
just might be more than you initially realize.
to Investor’s Business Daily, consumers with cell phones are paying
$5.8 billion in excessive state and local taxes, and another $5 billion
goes to Uncle Sam. That’s a lot of money for those “little” items that
many don’t even notice on their bill.
If you do look, don’t be surprised to see even more taxes added in the very near future.