The gross receipts tax on cell phones imposed an additional 5 percent fee on users’ monthly wireless phone bills beginning January 1, 2004.

“This onerous new tax on cell phones combined with the 6% sales tax on monthly service, gives Pennsylvania the distinction of having one of the highest cell phone tax rates in the country,” Wonderling said.

The 5% gross receipts tax on mobile telecommunications and interstate telephone calls will cost consumers an estimated $222 million this tax year and approximately $362 million in the next fiscal year that begins July 1, 2004.

“Other states that impose a gross receipts tax generally will repeal or reduce another tax, such as sales tax or a business tax, but Pennsylvania did not alter the tax burden on cell phone customers,” Wonderling said.  “By doubling the state taxes on wireless service, we are making it difficult for many people to afford to use cell phones and discouraging the wireless industry from expanding in our state and investing in new technology.”

Wonderling said that the wireless telecommunications industry is on the vanguard of technological innovations that will allow for seamless wireless internet access from personal computers and hand-held devices that will benefit health care workers, transportation companies, government and many other businesses.

“Repealing the gross receipts tax on cell phones is critical to support technological progress, promote worker productivity and create jobs in the telecommunications industry,” Wonderling said.

Wonderling praised the leadership of State Representative Kelly Lewis for his tireless efforts in the House of Representatives to repeal Pennsylvania’s cell phone tax.

The Legislature also passed a new law last year that created the E-911 system through a $1 monthly charge on cell phones. This new system will not be affected by Senate Bill 1156.