New tax starts Wednesday for prepaid wireless

By Peninsula Daily News staff

OLYMPIA — Consumers of prepaid wireless phones and minutes will see a new charge on the sales receipt starting Wednesday (Jan. 1).

That's when a new state law takes effect that requires retailers of prepaid wireless services to collect the tax that supports enhanced 9-1-1 services, or E9-1-1.

Wireless companies already collect and remit the tax.

Cellphone users under contract pay this tax on each month's bill.

But for prepaid wireless users, the tax was not part of their purchase of phones or minutes. Now, prepaid wireless users will be charged the $1 fee at the cash register to be collected by retailers.

Local governments will receive 70 cents of the tax, and the state will receive 25 cents. The new law will allow retailers to charge 5 cents to cover their cost of collecting the tax until July 1, 2018.

The tax supports the technology that enables local 9-1-1 emergency services to pinpoint the location of cellphone users who call for help.

The E9-1-1 tax is in addition to state and local retail sales taxes.

The tax comes as part of House Bill 1971, a larger telecommunications bill passed by the state Legislature during the 2013 session.

Last modified: December 30. 2013 8:13AM
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