Understanding Regulated and Non-regulated Charges to Your Phone
Bills
Unfortunately the subject of taxes as it applies to your
telecom bills is broad enough to warrant a lengthy discussion.
In Part 1 of this subject, we'll take a close look at the
regulated and non-regulated charges to your bills. In Part II,
I'll cover a few "rules of thumb" of just how taxes are applied
to these charges, and a few tips on how to recover money due to
incorrect taxation to certain business entities or non-profit
groups.
The charges for local telecommunications services include both
regulated and non-regulated types. Taxes are assessed on both.
You can find most of these specific charges contained in the
"summary" section of your bill.
Regulated Charges
Tariffs are developed and filed by the Local Exchange Carrier
with the state and public utility commission. After approval,
these public documents define rules under which regulated
services will be provided, and the charges that will be applied.
Once approved, tariffs have the weight of law, and deviations
require special approvals by the utility commissions. For
detailed information on tariffs, visit CCMI. (Center for
Communications Management Information) The following are
services regulated by tariffs in most states:
Connections to the central office (CO) and any local usage
charges (excludes wireless) Service enhancements are usually
regulated. In several states, however, centrex-like services are
now unregulated and such deregulation is becoming more common.
White-pages directory services (except bold listings) Operator
services provided by local exchange companies Service
initiation, changes, repair, and the like are usually regulated.
The expression of such charges may be a "price list" of specific
items, or it may be expressed as time and material "rates" for
categories of work. Some standard kinds of studies are priced
through regulation. Detail of local usage or message units are
typical examples. Most "other" services
Non-Regulated Charges
Various price schedules and rates are applied to non-regulated
offerings, in accordance with current business and competitive
conditions. Keep in mind that all non-regulated charges are
subject to rapid change and negotiation, although some are
traditionally fixed for a year at a time.
Prices and rates for non-regulated items must be obtained from
suppliers. The following services are unregulated in most states:
Terminal and switching equipment, and ancillary items. Pay
telephones. Some service enhancements, such as wire maintenance
and voice mail boxes Directory advertising, bold listings,
street directories Sale of "foreign" directories. Many kinds of
studies and some technical service matters, some corridor and
other services.
In Part II, we will look at the taxes - federal, state and local
- that are imposed on both the regulated, and non-regulated
portions of your bills. Included will be the three
"rules-of-thumb" for taxes, along with the specifics on what
these taxes are and the purpose for which they are paid, and,
who is exempt from them.