VoIP is less Taxing than
Traditional Telephone Service. By: Chris
When it comes to VoIP Broadband Telephone
service, there are many benefits. Unlimited local and long
distance calling, included features such as CallerID, Call Waiting,
Find Me/Follow Me, etc., and reduced costs. Many people
overlook one thing when they are comparing the price of a VoIP
provider and their Traditional Telephone service, and that is “What
taxes are associated with VoIP telephone service vs. what taxes are
associated with traditional telephone services?”
In my opinion, this is a huge factor in making
the decision to go with a VoIP Broadband Telephone solution.
The only VoIP Tax (as of the writing Feb. 2005) associated with a
VoIP service is a Federal Excise Tax of only 3% of the bill.
For example, if you signed up for a VoIP unlimited calling plan for
only $19.95 per month your monthly total would equal $20.55.
This $20.55 per month would cover all of your calls to the U.S. and
Canada, all of the included features, and quality customer service.
(Noted exception: Vonage customers located in N.J. are required to
pay sales tax on their Vonage VoIP service.)\
Conversely, a Traditional telephone bill
includes numerous taxes and surcharges. For example, I had a
discount telephone company that only charged me $9.99 per month for
a basic Traditional Telephone service in California.
Please look at the breakdown of all of the taxes and
SVC AND COMM DEVICE FUND
UNIVERSAL LIFELINE SERVICE
COST FUND SURCHARGE A
COST FUND SURCHARGE B
TOTAL TAXES, FEES AND
So, my bill total was $20.02 for the month and
that was before I ever picked up the telephone to make a telephone
call. Also the only feature that I opted for was Call
You can draw your own conclusions on whether
or not VoIP is right for you. If you don’t make any outgoing calls
then you may want to stick to your traditional telephone
company. But from an economical stand point, VoIP is clearly
the less expensive option if you make any long distance telephone