Hi all, how can I find out the latest telecommunications tax in my area (Snohomish, WA)? I got a quote from a VoIP recommended by colleagues in September and they quoted 17% estimated telecommunications tax. I got a new quote from them last week and now it’s 19%. They said it’s because the tax increased even though it’s still the same calendar year? Thanks
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Assuming you are buying a unlimited dialing prepaid annual - here are some helpful things to know . The provider pays per 1/10th minute both directions for you to talk on the phone. The price is so low they can reasonably guarantee profit across thousands of subscribers. They will collect taxes (tariffs) based on what their software tells them to do and remit to either individual governments OR what most of us do is pay a tax regulation service to do it all. It’s really 28-30% for anywhere in US if doing an estimate. Although you are within your rights to question it, I would be annoyed if a customer did so as I am taking on a lot of risks of being wrong about the customer usage. Certainly ask for real tax rates on invoices if you sign up. Also FYI some of the taxes are per DID (line) and not percent based. They tried to break it out between tax and regulatory fee but I prefer to break out at least into 911, FCC, state telecom and state sales tax. If you add the two together is slightly over 30%
If it’s naked VOIP (Callcentric, Flowroute, etc) then there is a slight recovery fee.
If you are using a VOIP service that includes phones and such, then it will be taxed for 911, Universal Access, State Utils, Etc.
The FUCF tax changes regularly, it goes up and down. That’s out of the providers control and will be the same between different providers.
Generally these tax estimates are provided to companies by whatever tax agency they utilize to estimate what the tax will end up costing them in different places. They can and will be wrong sometimes, and can differ from company to company and specifically with it changing from not only state to state but sometimes county/area code, it’s really hard to lock down a concise answer. If you get a quote for tax estimation and it’s +/- 5% , that’s to be expected, imo.
Thanks, didn’t realize it was so confusing/obfuscated. Just thought it was weird for it to suddenly change as it hadn’t been a calendar year yet.
Yeah, just too many moving pieces. County A in Oklahoma passes a bump in tax or fees related to ip communications, you’re already billing a client based on xyz original estimate, voip company ends up owing more in taxes than they originally thought and realize theyre losing more on you as a client than other accounts (this happens several months/quarters after the increase), they realize, and update the taxes associated with your location.
Someone more affiliated with finance could probably explain it better, I was the tech guy for a smaller voip company but heard enough about specific billing/tax compliance in different states to know there’s like 3-4 different moving entities involved and it doesn’t surprise me in the least when those numbers are off or change quickly.