SB 1603 Imposes 6% Cell Phone Tax

This bill imposes up to a 6% tax on cell phones to extend broadband services to rural areas without internet access. Subject to a maximum $28 million in the universal service fund.

Personal Choice and Responsibility
This isn’t the time to burden wireless consumers with an additional tax than will have a greater effect on low income. Low income families go wireless to save money so cutting landline from 8 to 6% won’t relieve low income, but will now be charged up to 6% for each cell phone they have on a family plan. Cell phones are used for security and safety of family members.

Fiscal Responsibility
It expands the fees and adds a tax on cell phones. Raises $2.5 million per biennium with only 15% being used to build broadband. Emergency board provided $20 million already, USDA provided $6 million in Grant and Wheeler Counties, so this is a tax without an emergency purpose. Cares Act funds are available and may provide more funding.

Limited Government
Creates a turf war between cell phones and broadband that may be rectify at the national level so this may be premature. PUC is reviewing the Oregon Service Fund that expires in 2021 and this review should be completed before more funding is instigated.

Local Control
Nearly 60% of rural communities have no broadband, which has hampered virtual schools during the pandemic. To apply for federal grants takes matching funds which rural communities don’t have.