California considering proposal to tax text messages

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Thursday, December 13, 2018
California wants to tax your text messages
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California officials are voting next month on a proposal to tax text messages.

SAN FRANCISCO -- Soon, Californians may have to think twice before texting. The California Public Utilities Commission (CPUC) is set to vote next month on a proposal to add on a surcharge for text messages.

Many tell ABC7 News that reviewing their current cellphone bill is already a challenge. Wireless customers point to the fine print, saying it's difficult to recognize exactly what you're being charged for.

Carl Guardino, president and CEO of the Silicon Valley Leadership Group, calls the proposal "bad practice."

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"When hardworking Californians are already feeling taxed and 'feed' to death, not every new idea needs a new tax to fund it," Guardino told ABC7 News. "Here's a great example, the CPUC is sitting on $1 billion for this purpose."

He's referring to the Public Purpose Program. The Federal Government and states put the program in place, which charges customers a fee for telephone service. The money collected then helps fund programs for the poor.

The new proposal would extend the existing tax to include text messages.

"I don't actually use my text messages a lot unless I'm texting someone on an Android or something like that," wireless customer Braulio Gamino told ABC7 News. "So, not often am I using my phone for text messaging."

This wouldn't be a tax for services like Apple iMessage or Facebook Messenger, but for text messages sent on your cellphone.

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"This is the Grinch that is stealing Christmas by stealing the tax for texts on your phones," Guardino said. "We can do better than this."

In a statement to ABC7 News, a CPUC spokesperson wrote, "Some wireless carriers assess surcharges for texting, other carriers don't. This proceeding seeks to clarify the rules on whether texting revenues are surchargeable or not."

The CPUC said the money needs to come from somewhere. If it doesn't come in the form of a text tax, you may see higher voice service charges.

In the statement, the CPUC acknowledged the impact to consumers. "The charge may even out, because if more surcharge revenue comes from texting services, less would need to come from voice services," the statement read.

Additionally, the statement read, "If texting surcharge revenues are not collected to support those programs more would need to come from voice services. The surcharge rate is less than 7 percent currently, so for every $10 of text revenues, it would cost about 70 cents."

The FCC is expected to meet Wednesday on the issue. The CPUC said the proposal goes to vote January 10.

See the proposal by CPUC here.


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