Friday, May 26, 2006

It's a Start

The Treasury Department has cancelled a federal tax.
A pesky, century-old tax on your phone bill is finally being put to rest.
The Treasury Department said Thursday that it will no longer collect a 3% federal excise tax on long-distance calls and would refund about $15 billion to taxpayers.

The tax was imposed in 1898 to help pay for the Spanish-American War. It was designed as a tax on wealthy Americans, back when phone service was considered a luxury.

"It's not often you get to kill a tax, particularly one that goes back so far in history," Treasury Secretary John Snow said.

Treasury said it was conceding its battle to uphold the tax after five appeals courts declared it illegal because of changes in the way long-distance calls are billed.

Phone companies and cellular carriers must stop billing for the tax Aug. 1. Individuals and businesses can file for refunds next year on their 2006 tax returns for excise taxes paid on long-distance calls since March 1, 2003.
It's a good sign that we no longer have to pay for the Spanish American War.