Cell Phone Tax Unconstitutional

That’s what a federal appellate court said. In the Telecommunications Act of 1996, Congress delegated its taxing power to the Federal Communications Commission (FCC). The FCC then subdelegated the taxing power to a private corporation. That private corporation, in turn, relied on for-profit telecommunications companies to determine how much Americans would be forced to pay for the “universal service” tax that appears on cell phone bills across the Nation (about $9 billion in 2021). The court stated: “this misbegotten tax violates…the Constitution.” Only Congress has the power to levy a tax. The FCC’s attempt to characterize the tax as a fee did not work. Experts expect this case to go to the Supreme Court. How much savings should you expect if the universal service tax is removed from your bill? The Tax Foundation reported that the tax in 2023 was 10.8%, but it is difficult to determine the exact charge. #IdeaoftheDay