Voice Services Tax Requirements

FCC Requirements and NM State Requirements

Administrator

New Mexico: Common taxes, surcharges and fees details

Source: 

http://www.nmprc.state.nm.us/consumer-relations/docs/phone-surcharges.pdf

Federal Excise Tax 3%–

The Federal (U. S. Government) Excise Tax is a tax imposed directly on the customer by the Federal Government for certain communications services. Congress determines the tax rate and the services to which it applies. The Federal Excise Tax is intended to tax services that allow the customer the ability to communicate with virtually all subscribers of the telecommunications network.

State 5.125%

City & County Taxes – (percentage depends on where you live in NM)  

The "sales" taxes in New Mexico are technically Gross Receipts Taxes imposed on the retailer's gross revenues and are passed on as allowed by state law. These taxes exist at the state

County and city level and all are administered by the state and required to follow state rules. The rates for county and city sales taxes vary. The only relevant distinction in what is taxable is that the state taxes interstate toll (at a reduced rate) while cities and counties cannot tax interstate product/services.

Federal Access Charge $6.50 –

The Customer Access Line Charge is a charge proposed and authorized by the Federal Communications Commission.

        Access charges are fees charged subscribers or other telephone companies by a local telephone company for the use of its local network.

        The FCC allows local telephone companies to bill customers for a portion of the costs of providing access. These charges are not a government charge or tax. The maximum allowable access charges per telephone line are set by the FCC, but local telephone companies are free to charge less or not at all. Access charges for second or additional lines at the same residence are higher than the charges for the primary line. These charges can be described on your telephone bill as “Federal Access Charge,” “Customer or Subscriber Line Charge,” “Interstate Access Charge,” etc.

Federal Universal Service Fund 17.9%:

The Federal Universal Service Fund (FUSF) supports the telecommunications needs of consumers living in high-cost areas, low-income households, schools, libraries, and rural healthcare providers.  Each telecommunication company may implement the Federal USF differently.

                The Universal Service Fund (USF) provides support to promote access to telecommunications services at reasonable rates for those living in rural and high-cost areas, income-eligible consumers, rural health care facilities, and schools and libraries.

                All telephone companies that provide voice service between states and internationally, including wireless and interconnected Voice over Internet Protocol (VoIP) providers, must contribute a percentage of their revenues derived from these services to the USF. Some states impose similar requirements for revenues derived from intrastate services.

                Although not required to do so, many service providers choose to pass their contribution costs to the USF on to their customers in the form of a line item on customer bills, often called the “Federal Universal Service Fee” or “Universal Connectivity Fee.” The charges on bills may not exceed the provider’s actual cost of contributing to the USF.

 Federal Charge – Service Provider Number Portability –

The Local Number Portability Charge, which became effective February 10, 1999, is designed to help cover the costs of facilities upgrades necessary to allow customers to retain their telephone number(s), at the same location, when they change from one local service provider to another. The Telecommunications Act of 1996 requires that each local exchange carrier provide number portability in accordance with the requirements prescribed by the Federal Communications Commission.  This fee has or will be removed; this is not a permanent charge on your bill.

Telecommunications Relay Service Surcharge .33%:

This surcharge funds a statewide program to provide telecommunication services to residents who have communications disabilities, i.e., hearing or speech. Funds are remitted to the State Commission and used to establish and administer a statewide Telephone Dual Relay System that will permit full and simultaneous communication between communications disabled persons and persons with conventional telephone equipment. This surcharge is mandated by state legislatures to make telephone service as accessible to communications disabled persons as it is for persons without such disabilities. Since it is governed by the state legislature it applies to all customers physically located in the state.

State 911 or Emergency Network Surcharge $0.51 per access line –

Telecommunication carriers collects 911 surcharges each month for states, counties and/or cities that use this money to fund their emergency services communications systems (E911 or 911). The surcharge is imposed upon each access line within a jurisdiction's 911-service area. New Mexico imposes two 911 charges: one is called the Emergency Services Surcharge and the other is called the Network and Database Surcharge. These are combined on the customer bill.

New  Mexico  Universal  Service  Charge  3.3% –  

This  charge recovers  the  amount  the telecommunication carrier contributes to the New Mexico Universal Service Fund. This fund helps keep basic exchange rate affordable. Many service providers choose to pass their contribution costs to the NMUSF on to their customers in the form of a line item on customer bills, often called the “New Mexico Universal Service Fee”.  The charges on bills may not exceed the provider’s actual cost of contributing to the NMUSF

New Mexico Access Charge $1.59 per access line –

This charge allowed by the NMPRC, covers part of the cost for providing access to and maintenance of the local network.

Charges Definition based on FCC

Access charges

  • Local telephone companies are allowed to bill customers for a portion of the costs of providing access to its local network. These charges are not a government charge or tax. The maximum allowable access charges per telephone line are set by the FCC, but local telephone companies are free to charge less than that, or even nothing at all.
  • Access charges for second or additional lines at the same residence are higher than the charges for the primary line. These charges can be described on your telephone bill as "Federal Access Charge," "Customer or Subscriber Line Charge," "Interstate Access Charge," etc.
  • State public service commissions regulate access charges for intrastate (within a state) calls. In some states, a state subscriber line charge may appear on customer bills.

Federal excise tax

  • This three percent tax applies only to local service billed separately from long distance service.

State and local taxes

  • Taxes imposed by state, local, and municipal governments on goods and services that may also appear as "gross receipts" taxes on your bill

Universal service charges

  • All telecommunications service providers must contribute to the federal Universal Service Fund, which allows those living in rural and high-cost areas, income-eligible consumers, rural health care facilities, and schools and libraries to access to telecommunications services at reasonable rates through programs and initiatives such as the Connect America Fund, Lifeline and E-rate.
  • A "Universal Service" line item may appear on your telephone bill when your service provider chooses to recover USF contributions from you, the customer.  The FCC does not require this charge to be passed on to you, but service providers are allowed to do so.  These charges usually appear as a percentage of your phone bill. Companies cannot collect an amount that exceeds the percentage of their contribution to the USF. They also cannot collect any fees from someone who is a Lifeline beneficiary.

911, LNP, and TRS charges

  • 911 – To help local governments pay for emergency services such as fire and rescue.
  • Local Number Portability – For retaining your current local telephone numbers when switching from one service provider to another at the same location. Fees may vary by company; some may not charge any fees. These fees are not taxes.
  • Telecommunications Relay Service – To help pay for relay services that transmit and translate calls for people with hearing or speech disabilities.

Other charges

  • Directory Assistance – For placing 411 or (area code) 555-1212 directory assistance calls.
  • Monthly Calling Plan Charge – Applicable any monthly calling plan, such as unlimited long distance calling on your wireline bill or unlimited minutes on your wireless bill.
  • Operator Assisted Calls – For calls connected by an operator. Rates for these calls generally are higher than rates for unassisted calls.
  • Features Charges – Services such as call forwarding, three-way calling, call waiting, voice mail and Caller ID.

These charges would appear only on your wireline telephone bill:

  • Minimum Monthly Charge – Some long distance companies charge a minimum monthly charge even if you don’t make long distance calls.
  • “Single Bill” Fee – For combining local and long distance charges onto one bill. This fee is not mandated by the FCC and is not an FCC charge.  Some companies waive the fee for customers who pay bills online or by credit card.  You can avoid the charge by arranging for separate billing from your long distance telephone company.

Finally, these charges would appear only on your wireless telephone bill:

  • Airtime charges – If you don’t have any more voice minutes in your package, you could see airtime or per-minute charges on your wireless bill for any additional voice calls. Some providers round fractions of minutes to the next highest one, two, or three minutes. Check the terms of your service plan.
  • Roaming charges - Wireless providers typically charge higher per-minute rates for calls made or received outside of the service area or network defined in your service plan or contract.  Additional charges, such as a daily access fee, may also be applied.
  • 911 charges - Enhanced 911 service enables wireless telephones used to dial 911 to automatically transmit the caller's location to emergency responders. Wireless service providers may choose to bill their customers for E911 service costs.
  • Text messaging - You can be charged either a per-message fee or a flat, monthly fee for unlimited messaging.
  • Downloading fees -  For downloading more data (including apps, system upgrades, music files and ring tones) than the plan allows.
  • Detailed billing - Fees for detailing billing information for calls, such as date, time, duration, number called, or calling party.