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Cell-phone tax to undergo scrutiny

SHARE Cell-phone tax to undergo scrutiny

A $1 tax on cell phones, which many Utah cities have already approved, will most likely be studied by a Legislative subcommittee.

The focal points will be the fairness and legality of the $1 tax, which is imposed monthly by approximately 90 Utah communities on each cell phone. The tax is based on the mailing address of the cell phone user, not where the phone is used.

The subcommittee could include members of the Revenue and Taxation Committee and representatives from the cities and cell phone industry. Representatives will probably be appointed during the next interim meetings in September.

Industry representatives claim that the $1 tax is unfair to them because no other technology businesses have similar taxes. Even those industries that pay franchise fees — such as cable and telephone — receive tax breaks on their infrastructure that the cell phone companies do not.

City representatives defend the tax as necessary because of the administrative costs they incur from numerous cell phone towers. They also say that the tax is legal because it is a tax on a business.