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California Takes A Last Swing At VoIP
JamesB writes "News.com's Ben Charny reports that two California cities want to tax Internet telephony. This news comes on the eve of the FCC ruling on whether federal regulations will preempt local ones."
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I Hate to say this, but the great thing about VoIP is that it doesn't need to be located in any particular city or state, Outsource it to India.
I buy my Skype credits from a site in Europe. Not sure how they are going to be convinced to share my private personal data with the State of California.
Besides, the minutes are so cheap, the government tax seekers may be in for a rude awakening when it dawns on them that even a tax as high as ten percent of one penny is still less than one penny.
It may have been a good idea if VOIP minutely rates compared to real phone rates. But the days of $80 phone calls are gone.
"News.com's Ben Charny reports that two California cities want to tax Internet telephony. This news comes on the eve of the FCC ruling on whether federal regulations will preempt local ones."
Let's cut to the chase. What will we get out of being taxed? Will the service be more reliable? Will I get service guarentees? Will my bill be even lower? What's in it for me, if you start taxing Internet Telephony?
While it's easy to say that we shouldn't tax this or tax that, I'm reminded of Ron Kirk, when he was mayor of Dallas, who quipped, "when you are sitting at home in your virtual world and you have a short circuit and a fire breaks out, do you want us to send a virtual fire truck or a real big red fire truck?" My house was hit by lightning last year and the city of Southlake was kind enough to send a real fire engine, not just email a JPG or something.
IMHO - we need an overhaul of the tax system, I don't believe that it can be efficient to have dozens of different entities with the power to levy taxes. There's a cost to society, although it does keep all those lawyers and accountants employed.
Ihis is one thing i find strange about america (i'm an aussie) is the seperation of powers between the national government and the state government. In australia the government collects the taxes, which is distributed through to the states. The states are responsible for the running of the state, and can collect taxes on state based services (such as plane tickets), the local council can collect money in it's own area (parking etc). There is a clear hirarcy of power, the national government sets all national laws, the state sets it's state based laws, the councils set thair own laws.
It is not surprising that they are pushing for more taxes, though my guess is if they brought this to the courts it would be a tough sell.
Right now people get twitchy about taxing internet technology for fear that they will look 'anti progress.' What we need is for the VOIP companies to fight the cities, and see where things go from there.
Of course, being in california will make things tough for those trying to fight the tax.
NOT.
What justifies this sort of taxation?
Taxes are fine win me, as long as it's to pay for legitimate services. But I have a hard time seeing what additional government serives VoIP users need to pay for.
I think this is just a case of government seeing another opportunity to use people.
I voted against the recent CA proposition to tack a telephone surcharge on to pay for a health program. I'm obviously not against health programs, or even against taxes generally (within reason, of course). But slapping a million small taxes on each service (with a million pieces of paperwork to keep track of it all) is hopelessly inefficient and borderline dishonest. Hey gov't: if you're going to spend, then tax and admit to taxing. Stop trying to be sneaky about it.
VoIP is not going to be easy to regulate. This makes only slightly more sense then regulating something like... say, IRC. The only reason government has a need to intervene with VoIP in any way is to provide 911 services and possibly wiretapping.
....on a tax on air. Better yet separate taxes on Nitrogen and Oxygen.
These posts express my own personal views, not those of my employer
Funny how they always mention funding for police services, or the fire department, and never their own salary or the rest of the other unpopular half. For instance, the Burbank budget (pdf) for the next year forecasts
But they need a VoIP tax to pay for their police services. Right.
Oh, by the way, they're hiring.
sigs, as if you care.
This entire issue is very much about reduced gov't and reduced taxation vs. increased gov't and more taxes.
State and local policiticans see VoIP is an easy mark for more tax revenue. But it's only taxable if they can control the entire telephone and long distance business thru state level regulation. So don't underestimate the determination here, both of these issues greatly increase the power of local politicians.
Since VoIP is only used by businesses and a few not-too-vocal consumers, it's an popular and easy mark to tax right now. And the common man sees lots of taxes on his home phone bills, so it's only fair that everyone else pay taxes on their phone calls, right?
The monopoly ILEC's see taxation as a matter of reducing competitors' advantage and controlling the growth of VoIP for smaller customers.
They are late to the party on VoIP and want to use taxes as a means of reducing competition for their POTS based services. It's also seen as a way of narrowing the playing field. More taxes means more regulation, more lawyers, and more barriers to competition.
What would Groucho do?
You probably want a local phone number. Do you want to tell people to call some number in India to reach you?