Verizon Wireless Sued Over NY Tax – Passing ‘metropolitan commuter transportation district’ tax on to consumers…

In: Communication|Computer|Hardware|Site Feeds|Software|VoIP

26 Feb 2009


Be it wireless or landline, the phone companies have a long history of tacking strange fees and “taxes” below the line on your bill, instead of rolling the entire cost of doing business into the final price. The practice lets companies advertise one price while charging another — and use the fees to quietly hike prices — often while blaming the fees on Uncle Sam. While some taxes are obviously legitimate, carriers have often come under fire for pretending some “cost of business” fees are government mandated.

The Federal Government has largely turned a blind eye to the practice, and carriers are only usually pressured toward change by select State Attorneys General or class action suits in States with tough consumer protection laws (like Minnesota). The latest dust-up is in New York, where Verizon Wireless is being sued for tacking a “metropolitan commuter transportation district” tax on to consumer bills. Says the complaint:

“Defendant stated in its monthly bills to consumers, as well as in other places, that this charge was a tax that defendant is ‘required by law to bill customers.’ In truth, defendant was under no legal obligation to bill customers for this amount since that charge is one that is imposed on wireless providers, not on consumers,” stated the lawsuit filed by Albert Levy on behalf of himself and others in the U.S. District Court for the Eastern District of New York.

Of course, since this is a real tax imposed on Verizon (unlike the dubious “regulatory recovery” unfees we’ve complained about in the past) Verizon, who calls the case “silly,” probably will win this particular fight. Of course while less shady than the company’s nebulous use of other mystery fees, other carriers (like Sprint) include this particular tax in the regular price of advertised service. It once again raises the question over whether all taxes and fees should be included in the total, advertised price for clarity’s sake.
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