Sprint Fights $300 Million NY Lawsuit Which Claims Company Failed to Collect Taxes Last April Sprint was hit with a $300 million lawsuit by the State of New York for allegedly failing to collect and turn over to the state more than $100 million in taxes for its wireless phone services over seven years -- a case Sprint now shows every indication of challenging. Leaked documents had shown that Sprint has been "unbundling" the company's monthly plans so that users pay taxes on calls made to people within New York state -- but not to those made to other states. New York Attorney General Eric Schneiderman states that New York law requires sales tax on the entire amount of the monthly charges, regardless of the type of calls made. However, Sprint said New York law expressly exempted "interstate" calls from sales tax and that federal law permits mobile providers to unbundle taxable and nontaxable services.
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  acadielPress fire to beginPremium
join:2002-06-22
61705
kudos:1 | Might want to put a "M" behind $300, Karl... Sprint Fights $300 NY Lawsuit
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Betcha it cost them more to defend it  | |
|  |  cdruGo ColtsPremium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:7 | Re: Might want to put a "M" behind $300, Karl... said by acadiel:Betcha it cost them more to defend it
What do they care. Expect a couple of bucks more to show up as a "Government compliance recovery fee" to be tacked on until whatever the final cost is paid off. Then it remains as they realize it's untapped "profit". | |
| |  amarryatVerizon FiOS
join:2005-05-02
Marshfield, MA
 ·Verizon FiOS
| Re: Might want to put a "M" behind $300, Karl... said by acadiel:Sprint Fights $300 NY Lawsuit
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Betcha it cost them more to defend it
And it should cost NY about the same to prosecute, no? So if they don't win, what another government waste. | |
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|  Noah VailSon made my AvatarPremium
join:2004-12-10
Lorton, VA
kudos:2 | New York Cash Grab Looks like NY State has been following the Patent and Copyright industries and decided that Lawsuits are an Investment Vehicle.
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The Dark Tower's Skynet evolves from 4chan. | |
|  RARPSL
join:1999-12-08
Suffern, NY | What is an Interstate Cell Phone Call? I can see how call placed from a land line NYS phone to another NYS land line phone is an intrastate call and one placed to non-NYS land line phone is interstate (and thus supposedly exempt from taxes). The law was designed for such land line to land line calls.
The problem with deciding if a call is interstate or intrastate gets complex when we talk about cell phone calls. Does the phone number of the calling party (which is a cell phone) determine if it is being placed from NYS or does the location of the Cell Tower being used to place the call determine if it is a NYS call? IOW: Does the use of the phone while in Florida to place the call make it call placed in NYS or not? Then the same issue applies to the location of the called party - Is it the phone number or the location of the phone (for a cell phone) decide if the call is interstate or intrastate?
Sprint knows where the calling phone is located so they can use the cell tower location to decide if the call is being placed from NYS or not (and thus if it may be a call subject to NYS taxes) - Assuming that location not phone number determines where the call is assumed to be being placed from. The location of the called party is harder for Sprint to determine - Only a Sprint Cell Phone or a land line number can have its location determined. Any call placed to a non-Sprint cell phone can only use the phone number to represent location NOT the actual location of the cell phone when the call is received.
This is going to be an interesting issue to resolve since the law does not speak on the issue of cell phone placed calls - only land line placed calls.
All of this analysis is, of course, based on Sprint's claim that the law exempts interstate calls in the first place. If it does not, then the difference between placing the call from a land line or cell phone is a non-issue since all calls would then be taxed. | |
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 ·Comcast
| Re: What is an Interstate Cell Phone Call? Cell phone billing (calls made) has always been based on the area code of the account. Before the days of all these unlimited plans you may recall that as long as you call to a number of your same area code, or state's area code, it was a local call regardless of your location. This has long been established as the norm in billing calls on a per minute basis therefore it's a non-issue as far as arguments are concerned right now.
Everyone, states and phone companies, is trying to shake and squeeze every cent they can out of anyone they can. Lets see who blinks first. | |
| |  tc1uscg
join:2005-03-09
Saint Clair Shores, MI | Cell tower location doesn't matter. Cell places call, closest tower picks up call, sends call from tower to local carrier (if not direct to sprints switch). Local carrier routs call to a Sprint wireline office and/or wireless switch. Call is then handed off the Sprints LD wireline switch. Call routed to next hop, then next, till it reaches it's destination. Point being, regardless which central office the call hits, if it leaves the state, it's a "Interstate" call. Lucky for Sprint, it still refews to it's L/L switched as Long distance switches and if it hits one of those, it's bound to go out of state, and then maybe back. Depends on how the trunkgroup is routed. I've seen calls placed in Michigan, going to the other side of the state go from Detroit, then to Akron OH, then to Chicago, then to a ILEC or CLEC of a different carrier, then back to the state where the call stated from.  Kinda cool to do a call trace and look at all the nodes a call might bounce off from during it's run.  | |
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 joakoPremium
join:2000-09-07
/dev/null
kudos:5
·Comcast
| Wasn't it internet? I thought this was about internet usage, how internet access cannot be taxed and something along the lines of on the unlimited plans where unbundled to tax favorable terms.
Our landline carriers do this as well! They sell us a data T1 for $350/month... no tax because it's data/internet and then they throw in for another $50/month 24 channels of carrier-grade VoIP so only a small fraction is taxable. Of course it's quoted as "voice/data T1 $400/month."
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PRescott7-2097 | |
| | | great job nys!!! way to run companies out of NY or burn them to the ground!!! wooohoooo!!!! NY loves business!!!! | |
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State of New York tax collectors greedy leaches!
When I moved to Florida from New York State the second quarter of the year, several years ago, I was advised to immediately file a Declaration of Domicile, claiming residence in Florida. I filed a state income tax return for the income received in the State of New York the next year. A couple of Months later I received a notice from the greedy leaches in the New York State tax collectors office, to pay tax on the income received in Florida for the rest of that year. I sent them a copy of the Declaration of Domicile. I heard nothing further from New York. If I had not filed the Declaration of Domicile the greedy leaches would have tried to collect the taxes even though they were not entitled to those taxes.