VoIP Tax In Los Angeles, California.

Heartland.org has published an article about Measure S that was passed recently in Los Angeles, California. This imposes a 9% Tax on VoIP calls. The measure had won by nearly a two-thirds margin. So perhaps majority of people did not know what VoIP is.

Last fall, Congress passed a seven-year extension of the federal moratorium protecting Internet access services from federal, state, and local sales or excise taxes. So is this Tax illegal?

Los Angeles voters have imposed a 9 percent tax on Internet phone calls, known as VoIP (Voice over Internet Protocol). VoIP calls had been tax-free in the city.

Voters also enacted a 1 percentage point reduction in the tax on all other phone calls, from 10 percent to 9 percent. Most phone calls are still made over traditional wireline or wireless phones, but Internet phone service is a rapidly growing segment of the telephone market.

Measure S appeared on the February 5 ballot in Los Angeles and won by nearly a two-thirds margin. Voters were promised if they supported Measure S, the tax money would go toward police protection.

Critics of the new VoIP tax say there is no guarantee any of the money will go to police or other public safety services, as the proceeds will simply go into the city's general fund.

Heartland.Org

Written By: Steve Stanek
Published In: Info Tech & Telecom News
Publication Date: April 1, 2008
Publisher: The Heartland Institute

tag: VoIP Tax, Los Angeles VoIP Tax, Measure S