Taxes and Fees Glossary

 

We understand that the variety of taxes and fees shown on your bill every month can be puzzling. That’s why we created this helpful guide to explain¬†what each fee is and why they are collected from you. The amounts vary depending upon the state, county and municipality where you have phone service.

Taxes and Surcharges

Federal Excise Tax

A federal tax levied on consumers for the use of certain taxable local telecommunications services.

911 Service Fee/State 911 Surcharge/Emergency 911 Surcharge/Local Surcharge

Who pays for emergency 911 calls? We all do! This fee goes to compensate local public agencies operating your local emergency telephone systems.

State Maintenance Fee/Municipal or State Tax or Surcharge/Interstate Tax or Surcharge/Statutory or Carrier Gross Receipts Tax/ Utility Users Tax or Surcharge/Communication Services Tax/District Tax/Sales Service Tax

The names and amounts of these fees vary greatly and depend upon your location. Each state, county and municipality has special taxes that every telecommunication provider is required to collect on their behalf.

Business and Occupation Tax

A tax imposed on a company for the privilege of doing business in the taxing jurisdiction.

Franchise Tax

A tax levied on a telecommunications carrier for a franchise to provide services in a particular area.

License Tax

A tax for the privilege of soliciting and conducting business in a jurisdiction.

New York Franchise 184 and 184 Usage

Two taxes levied on local phone carriers operating in New York whose primary business is providing local service.

NY MCTD 184a Usage Tax

A tax levied on local toll usage for the NY Metropolitan Commuter Transportation District.

NY MCTD 186c Tax

A tax levied on telecommunications services for the NY Metropolitan Commuter Transportation District.

Transit Tax

A tax to support mass transit systems or projects in the service area.

Fees

Access Recovery Charge

The FCC permits local telephone companies to assess this charge to recover a portion of the costs incurred in the provision and maintenance of telephone service to connect customer’s homes and businesses to the telephone network.

Telephone Relay Charge/Relay Surcharge/State Deaf and Disabled Fund

This fee funds state relay centers that enable persons with hearing or speech impediments or handicaps to use the telephone. If you have ever noticed a special phone number for hearing impaired assistance, this is the fee that covers that service.

Universal Service Fund Surcharge/Federal Universal Fund/USF Interstate Services/Universal Lifeline Telephone Service Charge/Louisiana Universal Service Fund/School and Library Fund/CA High Cost Fund A/CA High Cost Fund B/CA Teleconnect Fund/Telecommunications Assistance Service Fund/Telecommunications Education Assistance Fund

A charge to recover the company’s contribution to Federal and State Universal Service Funds, which provide for affordable telecommunications services for rural regions, low income residential customers, and schools and libraries.

Primary Carrier Fee/Carrier Line Charge/

End User Common Line Charge (EUCL)/

Subscriber Line Charge

A charge for providing local connectivity between the customer’s premises and the telecommunications equipment used to complete calls.

End User Access Fee

A charge assessed to all end users to compensate for carrier charges, including costs associated with originating calls, leasing lines, and other basic expenses incurred in providing service. This charge is not mandated by any government authority.

Data Service Recovery Charge

For DSL customers, this charge offsets the costs associated with flowing high speed data across the various networks and backbone carriers both nationally and internationally.

Wholesale Carrier Charge

A fee charged by the Company to recover wholesale costs. This charge is not mandated by any governmental authority.

Regulatory Assessment Surcharge (RAS)

As a telecommunications company, we must make various payments to local, state, and federal departments and agencies, including, but not limited to, administration fees, inspection and supervision fees, and general public utility commission assessments. RAS is designed to help recover the cost of these payments. RAS is assessed on end-user customers based on a percentage of the individual customer’s respective interstate and international services invoiced.

Network Compensation Charge/Network UNE-L Fee

A fee charged by the Company for costs associated with building and maintaining a local network, connecting customers to the network, and updating related company systems. This charge is not mandated by any governmental authority.

PUC Fee

A fee to recover the company’s mandatory contribution to certain state regulatory bodies.

Paper Option

This fee applies to business services, and under certain long distance calling plans, if the customer chooses a paper billing option. Customers can avoid this fee by choosing electronic billing.

Municipal Right of Way Use Fee/Local Surcharge

A fee levied by the local municipality to compensate it for local phone lines crossing public rights-of-way.

Poison Control Fund

A fee imposed by the state for the purpose of establishing and maintaining a poison control system.

Telecommunications Infrastructure Fund

A charge to recover the Company’s contributions to a taxing jurisdiction for the specific purpose of supporting telecommunications equipment like switches and networks.

Telecommunications Infrastructure Maintenance Fee

A charge to recover the Company’s contributions to a taxing jurisdiction for the specific purpose of supporting telecommunications equipment like switches and networks.

Energy Recovery Charge

A charge to compensate the company for rapid increases in energy expenses, fuel expenses associated with network maintenance, and higher related wholesale costs.