Sprint, T-Mobile Take Regulatory Battle to Supremes
Feb 28, 2007, 3:23 PM by (staff)
A fight over state versus federal jurisdiction of wireless carriers may head to the Supreme Court. Sprint and T-Mobile have asked the court to review a decision by the 11th Circuit Court regarding the carriers' right to charge consumers additional "recovery fees" for taxes and and other charges levied on carriers rather than absorbing the cost as other businesses do. While many state utility commissions have been trying to end this practice, the FCC issued a ruling allowing carriers to continue as long as they clearly itemized what each fee was for. But a 1993 law gave states the right to regulate terms and conditions of mobile phone service other than service rates. The states used this to contest the FCC ruling in the 11th Circuit Court and won. This decision will allow state regulatory agencies to determine whether carriers can levy additional fees unless Sprint and T-Mobile can get their case heard by the Supreme Court and win.
Phone service is one of the most taxed utilities, with taxes in some cases averaging over 20% of the total phone bills. Of that 20%, 80% is often levied by the individual state.
State & Local Taxes: 16.23%
Federal Excise: 3%
Federal USF: 2.48%
(see what your state is at: http://www.forbes.com/technology/2005/06/06/c z_sw_0606cellphone.html click on the map link to see individual states.)
Now the states (the same folks levying phone tax rates that look like European VAT rates) are suggesting that fees paid by T-mo and SN can't be passed through to the customer? The .80 to $1.00 of pass-through charges pale in comparison to the $10 of tax I pay. Tell me this is becaus...
two of the worst companies...
I am glad to be on Prepaid
The nice thing is the only way T-Mobile would be able to charge me for recovery fees is if they up their costs on prepaid services (which they might do if they win, and what they would raise would be prepaid text message rates, download costs, instant messages and picture messages)
I don't think T-Mobile would up the cost of their prepaid refill options.
I love prepaid because it is very flexible and I use it to my advantage so T-Mobile does not make extra on me.
You have T-Mobile Prepaid.
It works for you.
You love prepaid.
You like typing T-Mobile.
And it works for you?