Legislation would end 107 years of “temporary” tax on talking
WASHINGTON – Rep. Henry Bonilla (R-TX) today become the 100 th cosponsor of H.R. 1898, which would repeal the 3% federal excise tax on telecommunications, a 107-year-old “temporary” tax enacted to fund the Spanish-American War.
While the Spanish-American War tax was originally billed as a luxury tax in 1898, when only the wealthiest Americans had phones, the telephone is now a ubiquitous part of American life. The tax is therefore highly regressive, as it represents a greater share of the income of low-income and minority households.
In 2000, the House of Representatives passed legislation repealing the Spanish-American War tax by a vote of 420-2, and both houses of Congress passed appropriations legislation including the repeal in the same year. President Bill Clinton, however, vetoed the legislation.
“Repealing the Spanish-American War tax is long overdue,” said taxpayer advocate Grover Norquist. “We’ve been stealing money from telephone users for 107 years to fund a war it took us four months to win. Henry Bonilla’s cosponsorship brings this bill to a symbolic point. This is now a very serious effort. ”
A Senate companion to H.R. 1898 is expected to be introduced soon.