Thursday, July 24, 2003

Tax reform hits local government on telecommunications in Virginia

The Richmond Times-Dispatch has this article on the latest vote by the telecom tax reform committee of legislators, headed by Delegate Preston Bryant. The committeeis proposals include the following:

"The panel agreed to call for reduced consumer confusion, consolidated taxes, uniform taxes statewide, a reduced tax rate on most Virginians, competitively neutral taxes, preserved state and local revenue and establishing a single tax collection and distribution point.

The proposals call for repeal of local consumer utility taxes on telecommunications, local gross-receipts taxes paid by consumers, the Virginia relay fee for services to the deaf, the cable-franchise fee and the current E-911 tax structure. Some taxes vary from locality to locality.

In their place, the proposed plan would impose a 4.5 percent statewide sales tax on communications and video services and a E-911 fee on wireless and wireline phones not to exceed 75 cents per month compared with the current $3 monthly maximum."

The demise of cable franchise fees and other moneymakers for localities will draw heavy opposition from cities and counties.

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