Taxes in Pa. on cell phone service among highest in U.S.

Pennsylvanians pay the fifth-highest state and local cell phone taxes in the country, according to a new report from the Tax Foundation.

But they may not realize it because consumers don’t always pay attention to the tax line on their bill, said Scott Mackey of the Tax Foundation.

“Wireless taxes continue to be extremely high, especially if you compare them to other things you buy with a sales tax,” he said. The average rates of taxes and fees on wireless telephone services are more than two times higher than the average sales tax rates that apply to most other taxable goods and services.

And that represents a burden, particularly for low-income consumers who rely on cell phones as their only means of communication and connectivity, Mackey said.

At the end of 2013, according to surveys by the Centers for Disease Control and Prevention, more than half of all poor adults had only wireless service, and nearly 40 percent of all adults were wireless only.

Costs for wireless service can rise quickly because multiple government agencies add fees or taxes.

“Local government, state government and the federal government all get a piece of the cell phone user’s bill,” Mackey said. “So, in the case of Pennsylvania, you have both the state sales tax and the gross receipts tax. You’ve got local taxes in Philadelphia, and you’ve got 911 fees — $1.65 per line — and federal tax that goes to pay for multiple programs above that.”

New Jersey was 34th on the list and Delaware was 48th.