Tech Policy

The Social Cost of Wireless Taxation Executive Summary

Continual increases in state and local taxes of mobile service, digital goods, and digital services harm the ability of low-income communities to realize the full benefits of mobile broadband and create deeply troubling consequences for minorities and the poor. Understandably, the enormous growth of the mobile broadband and applications markets makes the consumer costs of wireless service, digital goods, and digital services tempting potential tax bases for struggling state and local governments. However, more tax increases on mobile service and the purchase of digital goods and services would perpetuate a regressive tax regime. Left unchecked, this tax structure will continue to harm low-income consumers who stand to gain the most from the potential of wireless broadband to lower their cost of living while improving their prospects in healthcare, employment, and other areas.