Before I go any further with this post, if you can tell me which famous St. Louisan said the last three words of this post’s title to which television personality some time back in the ’80s, or maybe early ’90s, then you will win some type of award, yet to be determined. (Probably just a mention on this blog, actually.) Answer to come later.
Back to the post. Today’s Wall Street Journal has an article on the cellular tax lawsuit making its way through St. Louis County Court. At issue is the contention by many municipalities that cellular companies should be paying the same utility tax on their customers’ bills as landline customers pay. University City is singled out by the Journal:
For example, University City, a suburb of St. Louis and the first to file suit against the carriers in this dispute, has seen its telecom tax revenue decline to $468,000 last year from $790,000 in 2000.
This is a tough issue, but I think the common-sense test goes to the cities. I understand the differences between the reasons for taxing the original phone systems and modern cellular systems, but still a phone tax is a phone tax. Ideally, the cities would win, the companies (and their customers, obviously) would only have to pay going forward — without back collections — and the various municipalities would use that additional revenue to lower rates on every utility tax, including phones. But if I really thought that would happen, I’d be living in a dream world instead of working in a think tank.
