97-050
Response September 3, 1997
August 6,1997
Tax Research Department
RE: Combined Telecommunication Services
I would like to receive a formal opinion as to how
taxes would be applied to telecommunication services bundled into one monthly
price?
Example - Unlimited Internet service, unlimited
local paging service(purchase of a pager required, activation included in price
of pager),X# of minutes of
outbound direct dialing on domestic
calls, 800 service calls and Travel Card calls at $XX.XX per month.
Any information that you might be able to supply
will be greatly appreciated.
Thank you for your time and help in this matter.
Sincerely,
NAME
September
3, 1997
NAME
ADDRESS
CITY STATE ZIP
Advisory Opinion - Taxation of bundled
telecommunications services.
Dear NAME,
We
have received your request for sales tax guidance pertaining to your company’s
charges for telecommunications services in Utah. We offer the following:
Sales
of intrastate telephone communications service is taxable in Utah. Taxable telephone services are described in
Utah Administrative Rule R865-19S-90 (copy enclosed), and include subscriber
access charges and charges for optional features, installation and repair,
intrastate long distance calls and paging.
Non-taxable charges include refundable deposits and charges for interstate long distance calls. Charges for Internet access or other on-line
computer services are not taxable.
When
a single transaction includes both taxable and non-taxable charges, the
non-taxable charges must be separately stated on the bill or invoice or the
entire amount is taxable. If your
company bundles both taxable and non-taxable service without itemizing the
non-taxable charges separately, the company must collect tax on the entire
charge.
Please
let us know if you have other questions.
For
the Commission,
Joe
B. Pacheco,
Commissioner