AT&T settles with Missouri over back taxes
AT&T Mobility agreed to pay up to $76 million in back taxes and legal fees to put an end to a six-year-old cell phone tax lawsuit in Missouri. Verizon Wireless settled an identical suit against it in September, while Sprint has settled with some of the Missouri municipalities involved but is still in negotiations with others. The basis of the municipalities’ lawsuit is whether they can levy a tax normally applied to utilities and landline phones to cell phone services, too. The suit originally sought $500 million in back taxes and fees, but the total looks like it will be far less. Verizon Wireless settled for $31.5 million.
A couple of years ago AT&T tried to get out of paying the Universal Service Fee by making pay phone users listen to an advertisement before the call. AT&T claimed it was in the advertising business, but ended up losing in court, and thus they paid around $500 million in that case if memory serves me correctly.
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