Understanding the Taxes on Your Phone Bill

  • Federal Line Cost Charge (Also known as Federal Access Charge, Customer Line Charge, Interstate Access Charge, Interstate Single Line Charge, Subscriber Line Charge or SLC) is a charge billed by your local service provider to pay part of the cost of supplying a phone line to your home or business. This charge also helps local telephone companies recover the cost of providing telephone wires, telephone poles and other equipment and facilities connecting to the telephone network. All telephone company customers are charged this fee.

 

  • The Federal Universal Service Fund Surcharge is a charge that goes toward maintaining affordable local telephone service for all Americans. The fund provides discounted telephone service to schools, public libraries and low-income customers. All telephone customers pay this surcharge.

 

  • The Federal Tax (also known as the Federal Excise Tax) is a set percentage tax on all telecommuni-cations services. The federal government mandated this tax back in 1898 and it is still in effect. It applies to local, non-regulated and toll charges. For more information on this tax you can contact the Internal Revenue Service Excise Tax Branch.

 

  • The Local Number Portability Surcharge (also known as Number Portability Surcharge or LNP) is a fee that allows local telephone companies to recover costs associated with customers keeping the same telephone number when they switch from one local provider (telephone company) to another. This is called “number portability”. The surcharge is temporary. Companies can pass it along to the customer for a maximum five-year period. It is not a tax. Local telephone companies may not charge this fee to customers who participate in the Lifeline Assistance program.

 

  • The State & Local Taxes (also known as Gross Receipts Tax Surcharge, Interstate Tax Surcharge or State Universal Service Fund) are taxes charged by the state, local and/or municipal government on goods and services. These taxes vary by municipality. However, all telephone providers that serve your area will charge the same state and local tax rates. For more information about state taxes, call the Pennsylvania Department of Revenue. For local tax information, you must contact your local tax bureau.

 

  • The 911 Charge is a fee charged by local governments to help pay for emergency services. In many areas the services include supplying the street address of callers through the phone lines to the emergency operator. Your local government determines the amount of this charge. All telephone customers are billed for the 911 charge.

 

  • The Pa Relay Surcharge funds the state relay center that transmits and translates telephone calls for persons who are deaf, hard of hearing or have speech and language disorders. All telephone customers pay this surcharge.