Report: Tax rates on cell phones can be steep

Residents of nine states pay an average state and local tax rate of at least 13 percent on their cell phones, a new map from the Tax Foundation shows. 

The map, which the nonpartisan group based off a recent private sector report, shows that regional differences cannot tell the whole story when it comes to which state’s residents get hit the hardest with cell phone taxes.

Oregon, for example, has the country’s lowest average state and local rate for cell phones: 1.81 percent. But the state’s neighbor to the north, Washington, has the second-highest rate among states: 17.95 percent.

At 18.64 percent, Nebraska had the highest average state and local rate for cell phones. 

According to the report from Scott Mackey, at KSE Partners in Vermont, Americans now face, on average, a 16.3 percent rate on their cell phones, when combining federal, state and local levies – roughly twice as much as the average retail sales tax rate. 

The Tax Foundation has also asserted that states are fans of taxes on cell phones because it allows them to raise revenues largely out of sight.