My monthly RR bill from Hawaiian Cablevision includes a charge for the state
cable franchise fee and state excise tax. I believe that
both charges are invalid, under current laws, and that Oceanic/Hawaiian
Cablevision,etc. should stop the charges and issue a refund for
charges previously collected.
On October 19, I spoke with Linda Thompson, Hawaiian Cablevision,
about this matter. She had no answers for me but said she would
escalate the matter and research it.
Under the Internet Tax Freedom Act of 1998, no state can impose a tax
on internet access. (This act is due to expire on Oct 21, 2001 but has
been extended by the U.S. House of Representatives and the Senate has not
yet acted upon this. If the act is not extended then any refund would be
limited to taxes collected before this date). According to the
archives at
http://www.vertexinc.com/cybrary/internet/state_by_state.asp#HAWAII,
internet access in Hawaii is exempt from taxation. This would include
the state excise tax that I have been paying on my RR bill. Before I
got RR in June 2001, I never paid any internet access tax (in the form of
the excise tax or any other form) to my ISP.
I am aware of several instances where RR/TW has stopped collecting state
sales tax and franchise tax/fee. I am attaching correspondence between
a South Carolina RR/TW user and Larry Michalec, Jr., Vice President and
General Manager RR/TW Cable in Columbia, South Carolina. In this
instance, after the imposition of state sales tax and the cable franchise
fee to a RR bill was questioned by a user, RR/TW stopped collecting both
taxes and refunded all previously collected taxes.
There are many instances also where other providers of RR such as Cox in
Kansas, have removed all sales tax and franchise fees/taxes relating to
RR (not cable tv) from users bills and have refunded previously improperly
collected fees.
This ruling is final (there was no appeal) and
is binding on all states within the jurisdiction of the Ninth Circuit which
includes the state of Hawaii. Unless and until the FCC issues a ruling
on this matter, the Ninth Circuit ruling is applicable in Hawaii.
AT&T and Cox have refused to pay franchise fees/taxes in all nine states
within the Ninth Circuit's jurisdiction and have removed these charges from
the user's bill.
Sincerely,
Marilyn Wells
ATTACHMENT:
From: "Flatus
Ohlfahrt" <flatus@tricare.org>
Subject: Re: Time Warner v Earthlink--Such a deal.
Date: Thursday, October 18, 2001 6:55 AM
wbe @ubeblock.psr.com.invalid (Winston Edmond) wrote in
news:ydofn5ndfg.fsf@UBEblock.psr.com:
> Flatus Ohlfahrt <flatus@tricare.org> writes:
>> Yes, I got them to stop charging state sales taxes and local
>> franchise fees. It was based on a South Carolina
>> implementation of the federal policy prohibiting taxation of
>> the internet. It amounted to a sizable dollar figure because
>> the franchise fees, especially, can be quite steep.
>
> Oh, really?! <:-) Hmmm, let's see... Interesting...
>
> Comparing a non-RR bill with a RR bill I find:
> * SC sales tax stayed the same, but
> * the franchise fee went up $2/month.
>
> So, yup, it looks like the franchise fee is a 5% tax on the
> total bill, including internet service.
>
> Now, how exactly did you convince TWC to rebate $2 * N months
> and lower your monthly bills?
> -WBE
>
Here's the correspondence with my name edited out:
From: "Larry Michalec" <larry.michalec@twcable.com>
To: me@sc.rr.com>
Subject: RE: Internet Taxation
Date: Mon, 27 Mar 2000 08:44:27 -0500
X-Mailer: Internet Mail Service (5.5.2448.0)
Me,
We will be crediting accounts where taxes were improperly
applied. Thanks again.
Larry Michalec, Jr.
Vice President and General Manager - Road Runner
Time Warner Cable
293 Greystone Blvd.
Columbia SC 29210
Phone: 803.251.5290
Fax: 803.251.5345
E-mail: larry.michalec@twcable.com
www.sc.rr.com
> -----Original Message-----
> From: Me@sc.rr.com]
> Sent: Friday, March 24, 2000 8:00 AM
> To: Larry Michalec
> Subject: RE: Internet Taxation
>
> I'm glad you were able to get things sorted out (you are
> going to make an accommodation for taxes that were improperly
> collected?)
>
> FWIW, I did call the number on my statement when I received
> my bills. Gave the woman I talked with in January all the
> particulars. Never heard anything back. After February's
> bill, called again and was rerouted to etherspace. Did make a
> mention of it in one of the RR newsgroups, but nothing
> transpired. Chris Clark finally shook it loose when he was
> following-up on another matter.
>
> No one ever said ramping-up a new service would be
> easy---especially when it's layered on a similar technology,
> but totally different culture.
>
> Thanks for your help!
>
> Me.
>
> At 08:07 AM 3/23/00 -0500, you wrote:
> >Dear Mr. Me,
> >I wanted to follow-up with you regarding the internet
> >taxation issue that you brought to our attention. We have
> >investigated the issue as I noted below and have arrived at
> >a resolution. We are going to discontinue the
> tax
> >on Road Runner service you have seen in the past in your
> >bill. Per our Controller, this change will be put in effect
> >immediately.
> >
> >Please do not hesitate to contact me regarding this issue or
> >any other
> that
> >your have concern over. I am also an experienced user of
> >news groups and
> we
> >at Road Runner intently focus on resolving issues that are
> >brought to our attention. Please do not feel like using the
> >news groups is the last
> resort
> >or preferred way to catch our attention. Please keep my
> >number at hand. As VP for Road Runner you have a direct
> >access line to the top.
> >
> >Again, thanks for your help.
> >
> >Larry Michalec, Jr.
> >Vice President and General Manager - Road Runner
> >Time Warner Cable
> >293 Greystone Blvd.
> >Columbia SC 29210
> >Phone: 803.251.5290
> >Fax: 803.251.5345
> >E-mail: larry.michalec@twcable.com
> >www.sc.rr.com
> >
> >> -----Original Message-----
> >> From: Larry Michalec
> >> Sent: Monday, March 20, 2000 3:14 PM
> >> To: 'me@sc.rr.com'
> >> Cc: Dean Morman
> >> Subject: Internet Taxation
> >>
> >> Dear Mr. Me,
> >> Thank you for your recent e-mail expressing concern
> >> regarding taxation
> of
> >> your Road Runner account with reference to SC Information
> >> letter #99-9.
> >>
> >> I have reviewed the document and forwarded for action the
> >> document to
> Time
> >> Warner corporate headquarters. I want to assure you and
> >> all Road
> Runner
> >> subscribers that we are investigating the issue fully. In
> >> the event
> there
> >> is a resolution that impacts the taxes already paid to us,
> >> we will act swiftly to remedy the issue and credit back
> >> funds that might have been inappropriately collected.
> >>
> >> We will be back in touch with you as soon as we hear from
> >> Corporate. Thanks again for making this issue visible to
> >> us.
> >>
> >> Larry Michalec, Jr.
> >> Vice President and General Manager - Road Runner
> >> Time Warner Cable
> >> 293 Greystone Blvd.
> >> Columbia SC 29210
> >> Phone: 803.251.5290
> >> Fax: 803.251.5345
> >> E-mail: larry.michalec@twcable.com
> >> www.sc.rr.com
> >>
> >
----- Original Message -----
To: Marilyn
Sent: Thursday, October 25, 2001 10:00 AM
Subject: RE: Internet access tax and franchise fees
Dear
[Marilyn],
Thank
you for your e-mail. I wanted to let you know we have receive it and we are
in the process of preparing a response and hope to have that to you early
next week.
Thank
you,
Kiman
Wong
Kiman
K. L. Wong
General Manager-Internet Services
Oceanic Cable
Phone:
(808) 625-8335
Fax: (808)
625-5888
----- Original Message -----
From: Marilyn
Sent: Wednesday, November 14, 2001 12:40 AM
Subject: Re: Internet access tax and franchise fees
Dear Mr. Wong,
I have been waiting for three weeks for your
response. I believe that Oceanic/Time Warner has had more
than adequate time to prepare a response. In the absence of any
reasonable explanation, for the lack of a timely response, I
believe it is necessary that I take this matter to the next
level. I will be filing a complaint with the Hawaii Department
of Commerce and Consumer Affairs within a few days.
Sincerely,
[Marilyn]
Later on November 14, Marilyn received an unbelievable
response from Kiman Wong, General Manager, Oceanic Internet Services.....