Santa Ana considers taxing … free Skype calls! Oh, the insanity

Santa Ana considers taxing … free Skype calls! Oh, the insanity

California is known as the world leader in lots of things — pop culture, technology and wacky lifestyles. Now the Santa Ana City Council is helping the Golden State be seen as the world leader in Maniacally Stupid, Excessive Taxation. This is from the Voice of OC: skype

“The Santa Ana City Council Tuesday night approved a November ballot measure that calls for adding prepaid cellphones to the utility users tax rolls and reducing the overall rate by 0.5 percent.

“If voters approve the measure, the tax will be levied on all prepaid cellphone customers, which represent 40 percent of the city’s population, according to a city staff report. Voice Over IP users, a phone technology that uses the Internet instead of traditional lines, would also be taxed.”

Skype is the king of VOIP services. Google Voice, which I use, is also hugely popular. Hundreds of millions of people make billions of calls a day. Some premium VOIP services charge $5 to $25 a month and are subject to a 3 percent federal excise tax.

Google-voiceBut by and large, the most popular VOIP services are free — of fees and taxes.

Here’s a bit of background on VOIP from a CNET story:

“VoIP refers to voice calls that are routed over online networks using the Internet Protocol — the IP that serves as the backbone of the Internet and is used to ferry e-mails, instant messages and Web pages to millions of PCs or cell phones.

“VoIP calls are just another application riding over the Internet. And these calls are unregulated. So at their core, they are no different from e-mails, instant messages or Web pages, which all can be distributed for free between Internet-connected machines. Those include computers and wireless devices, such as cell phones and handhelds, that are set up to receive online information.”

So, yes, the Santa Ana City Council wants to tax an Internet app that people have long used for free. I read the 32-page staff report available here on the proposed utility tax, and it shows not the slightest bit of understanding as to what VOIP is and how it works.

If anyone did have a clue, then of course the question of how would it be possible to enforce a tax on a particular use of the Internet might have come to mind.

Instead, members of the Santa Ana City Council just followed their first instinct: If it moves, tax it!

Ronald Reagan saw this coming long ago.

4 comments

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  1. Libi Uremovic
    Libi Uremovic 18 April, 2014, 07:27

    council members do not understand their jobs …. anyone running for government office should have to pass a basic test about state law and government …

    Reply this comment
    • Donkey
      Donkey 18 April, 2014, 07:53

      So true Libi, the problem the present citizens face is the RAGWUS feeders spend their collective time brewing up new ways to steal from the private sector citizens, anything that is used, needed, or wanted, in the mind of a feeding parasite, is theirs to tax. 🙂

      Reply this comment
  2. Rex the Wonder Dog!
    Rex the Wonder Dog! 18 April, 2014, 18:43

    The reason Skype, Magic Jack and other alternative communication systems are flourishing is because of out of control taxes. When I was in college and the decade after my phone bill was only $5.50 a MONTH. I did not have long distance service (I used a calling card for long distance @3.4 cents a minute when At&T was 20 cents a minute) but local calls including taxes was just $5.50.

    Thanks to Al Gore my phone bill DOUBLED, to $10.50 after he added in his $5 tax to fund the internet in schools. I guess regular taxes were not enough (not when you’re comping teachers $60-$150/hour). So when these alternative systems come into use it is an easy call, and one way government is killing America, by destroying the tax base because it is out of control, and way too high.

    Reply this comment
  3. Queeg
    Queeg 19 April, 2014, 08:50

    Santa Ana regretfully is worse than SF and San Diego.

    This is a drive around city…..the perimeter that is!

    Reply this comment

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