we paid for the spanish-american war, finally

Starting yesterday, long-distance telephone carriers are not allowed to add a 3% federal excise tax to our bill any longer. This includes wireless, VoIP, prepaid telephone cards, and other bundled services.

The tax was imposed 108 years ago to pay for the Spanish-American War. Once the war was paid off, the tax dollars went into the general fund.

At the time it was imposed (as a one-cent-per-call fee), it was intended that the wealthy shoulder most of the burden for paying for the war since, at the time (1898), only the wealthy could afford telephone service. (Interesting—this was a Republican tax imposed during McKinley’s term. And this was a war, fueled by propaganda, to, ostensibly, end the inhumane treatment of Cubans by the Spanish—yet, after the war, we ended up owning the Philippines, Guam, and Puerto Rico, and tens of thousands of Cubans and Spaniards died, and probably 250,000 Filipinos—and though less than 300 US soliers died in combat, about 5,000 died of disease ... ) Eventually it morphed into the 3% excise tax.

Anyway, the telcos have been fighting to end this (and other federal taxes) for years and finally succeeding in getting Congress to rule that the IRS could no longer collect this money. “Individuals will be allowed to claim three years’ worth of refunds on their 2006 tax returns. Taxpayers will be allowed to calculate their actual taxes paid or claim a standard amount to be set by the Treasury Department and IRS,” according to IT&T News in the Heartland Institute. I wonder if it will be an automatic credit or if you’re just SOL if you don’t itemize. Businesses, however, will have to spend beaucoup bucks to prove they have a refund coming.

What I’m wondering is how we’re going to pay for this lost revenue down the road—consumers rarely come out ahead when it come to big business and taxes and the government, so I’m waiting for the other shoe to drop before I celebrate.

Posted by .(JavaScript must be enabled to view this email address) on 08/02/06 at 05:18 PM
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