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Press Release

Iowa CSE Director Sounds Off in Effort to Repeal Federal Excise Tax

02/12/2001

Letters to the Editor
Repeal excise tax on telecommunications

02/10/2001

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An excise tax on telecommunications instituted in 1898 to fund the Spanish-American War still penalizes consumers every time they pick up the telephone ("Grassley: Repeal Old Phone Tax," Feb. 2).
This month, U.S. Senator Charles Grassley proposed legislation to eliminate the federal excise tax. Grassley stands a good chance of succeeding where others have come up short. Last year, the House and the Senate passed a measure to eliminate the tax - on average more than $55 per household, but it suffered under the veto pen of President Clinton.

The tax is problematic for many reasons. First and foremost, it is a tax on communication - the basis of a free society and a healthy marketplace. In addition, it is regressive. This means that poor Americans feel its adverse effect more strongly. In today's communications marketplace, many high-speed services are difficult to categorize based on antiquated definitions. In fact, the tax that Grassley and his Democratic co-sponsor, U.S. Senator John Breaux, seek to eliminate applies to "telegraph, teletype and telephone" service.

The Spanish-American War lasted a few months. The tax created to fund the war effort remains after more than a century. It is time, once and for all, to relegate it to the history books.

-Jason W. Gross, director, Iowa Citizens for a Sound Economy, 3111 Ingersoll Ave., Des Moines.

[ This letter was published by the Des Moines Register Online