A tax break of a different kind - WALB.com, Albany News, Weather, Sports

A tax break of a different kind

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May 26, 2006

WASHINGTON  - The Treasury Department says it will no longer collect some telephone taxes on long-distance calls.  And it's going to refund about $13 billion to consumers.

The tax dates back to 1898.  At the time, telephones were more a luxury than a necessity, and lawmakers were seeking ways to raise
money to fight the Spanish-American War.

Companies have been fighting the tax in court and winning, arguing that the three percent excise tax should not apply to some long-distance calls.

People will be allowed to claim three years' worth of refunds on their 2006 tax returns, filed in 2007.  The federal excise tax on local telephone service remains in effect.