09-15-2012, 04:16 PM
There is a difference between sales tax and excise tax. (Of course if feels the same when you write the check.) Sales taxes are charged on the entire value of the purchase of new phones, and it has been this way for decades. It is just that the phones are so much more expensive that the tax line item becomes obvious.
Excise (or use) taxes are charged on some products (gas, booze,) in addition to sales taxes. However, most jurisdictions do not charge sales taxes on services. Instead they charge excise taxes on things like telecommunications or airline tickets.
Thus, monthly bills have several types of excise tax (federal, state, local, plus things like the "universal access" fees.) We are not paying more sales tax, we are paying a use tax every month.
Excise (or use) taxes are charged on some products (gas, booze,) in addition to sales taxes. However, most jurisdictions do not charge sales taxes on services. Instead they charge excise taxes on things like telecommunications or airline tickets.
Thus, monthly bills have several types of excise tax (federal, state, local, plus things like the "universal access" fees.) We are not paying more sales tax, we are paying a use tax every month.