Easing the wireless tax burden

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Today, there are more wireless subscriptions than people in the U.S and consumers are purchasing more smartphones than personal computers. In fact, half of American adults now carry smartphones and there will be an estimated two billion networked mobile devices in our country by 2015. Although historic levels of investment and innovation in the dynamic wireless ecosystem are transforming our connected lives, mobile consumers are shouldering a significant and growing tax burden.

High state and local taxes for mobile services hurt those who rely on wireless the most and can least afford it. More than 30% of adults are living in wireless-only households with low-income consumers making up a larger portion of this group.

There is also significant mobile usage in communities too often left on the wrong side of the digital divide. The Pew Research Center’s Internet and American Life Project found African Americans and Hispanics are adopting smartphones at a faster pace than the national average. The benefits of mobile broadband for all Americans are evident from the exponential growth in consumer demand across all communities.

The proposed moratorium in The Wireless Tax Fairness Act would not only protect consumers, but also help ensure that mobile adoption and usage is not discouraged by new, discriminatory state and local wireless taxes. It also would help minimize any unintended consequences that could depress innovation and investment or limit the vast opportunities for the nation’s economy. A recent study reported that the transition from 2G to 3G wireless networks created 1.5 million new jobs between 2007 and 2011. By placing a moratorium on any new wireless taxes, policymakers can ensure that consumers are protected and the U.S. mobile economy can continue to flourish.

The Senate needs to encourage continued innovation, investment, and access in the mobile sector. The Wireless Tax Fairness Act will be an important step forward to ensuring consumers reap the vast benefits wireless technologies, but without having to carry additional tax burdens in doing so.

Jonathan Spalter, chairman of Mobile Future, has been founding CEO of leading technology, media, and research companies, including Public Insight, Snocap, and Atmedica Worldwide. He served in the Clinton Administration as a Director on the National Security Council.