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State Representative Jennifer L. Mann It's undeniable: cell phones are everywhere. They are no longer just the latest trend, but a significant tool that people from every walk of life use. Business owners utilize these ubiquitous little devices to make deals; teenagers call home to see what's for dinner; stranded motorists dial for a tow truck. Most of America -- myself included -- can barely remember our society as it was before the mass use of cell phones. It is certainly true that these devices have made our lives easier; however, their widespread use has created a problem for the Commonwealth. Because people are using "land lines" less and less each year, the state is seeing a decrease in the tax dollars it collects from the phone bills for traditional phone use. In 2004, the state legislature enacted an extra tax on cell phone usage to try to lessen the blow from this loss of revenue. This tax, known as the gross receipts tax, placed an additional 5 percent levy on top of the other federal and state fees and taxes that currently appear on your cell phone bill. This is in addition to the 6 percent sales tax that you pay for the purchase of the actual telephone. Although I understand the reasoning behind the gross receipts tax, I have come to believe strongly that it is unnecessary and hurts the average Pennsylvania family. Also, I believe that this tax could hurt our state's business climate - and therefore, our economy. That is why I have chosen to co-sponsor HB338, which would repeal Pennsylvania's gross receipts tax on wireless telecommunications by January 1, 2006. The good news is that more than 100 of my colleagues in the state House, Democrats and Republicans alike, have co-sponsored HB338. Additionally, the House Finance Committee, of which I am a member, has recently voted it out of committee, which is a vital first step in eliminating this unfair tax. Before I was elected to the state House, I was a small business owner who sold wireless communications devices and plans. This background has given me a unique perspective in this debate, as I have an intimate understanding of how the gross receipts tax affects entrepreneurs and consumers of wireless technologies. Furthermore, as a member of the House Finance Committee, I have the ability to examine our state's economy in great detail. Keep in mind the following statistic: Pennsylvania has the eighth highest rate in the nation for wireless taxes. Currently, there are more than 6 million cell phone users in the state, which means that the gross receipts tax for wireless communication has a significant impact on consumers. Pennsylvanians are paying millions of dollars a year in taxes to the Commonwealth just to simply continue using their cell phones. Additionally, Pennsylvania's businesses paid approximately $36 million in cell phone taxes last year. That is real money that affects businesses' bottom lines. This tax has the very real possibility of stymieing the growth of small companies looking to expand, and could be the difference between an entrepreneur staying afloat or going under. I have spent the better part of seven years in the state legislature trying to expand opportunities for small businesses and support our new entrepreneurs in any way possible. However, if we continue to levy taxes such as this, we will undo all of the significant accomplishments we have already achieved. The accessibility and portability of wireless communications devices has altered our world. No longer are businesspeople tied to an office; people do not have to worry about finding a pay phone if their car breaks down; parents can now ease their fears and contact their children if they should miss curfew. Cell phones are convenient, reliable and greatly increase our safety. It is vital that we keep this technology affordable and available. I am optimistic that we will repeal the gross receipts tax and give average Pennsylvanians and entrepreneurs a break. Please know that I will continue to work with Gov. Rendell and with legislative leaders to pass this tax repeal during the current legislative session. CapNews Guest Speaker: Archives |
