In an effort to simplify one of the most complicated aspects of communications taxes, the FCC offers safe harbor percentages for reporting interstate and international voice calls. Will your business benefit from relying on these predetermined ratios? Or would you be better served investing in another method for gauging non-intrastate calls?
Download this Avalara whitepaper to answer questions like these, plus find out:
- Three key questions to determining if safe harbor is right for you
- How to accurately calculate the real cost of safe harbor versus other options
- How tax automation can streamline this process
Anyone who works in the realm of 3Gs, 4Gs and Internet protocols knows this: Rapid adoption of new technologies has forever changed how we communicate. Cellular networks, cable, satellite, VoIP and a multitude of emerging innovations have expanded the scope of the communications industry to include so much more than traditional telephone calls. Today, when customers want to initiate voice calls, they can opt for flat-rate monthly plans to do so while crossing state lines or use VoIP to speak with people on the other side of the world without incurring long-distance fees.
The lightning-fast pace of advancements has governing bodies in a bind: How do states and the federal government effectively regulate an industry that’s in a continuous state of change? Which taxes and fees should be applied, and when? As technology evolves faster than the law, the answers to these questions and others like them change frequently. As a result, communications service providers (CSPs) face some of the most complex calculations in the entire tax industry. Different areas of communications are all taxed in very different and exceptionally complex ways.
In an effort to help simplify one of the more complicated aspects of communications taxes for cellular and VoIP profiders, the Federal Communications Commission offers safe harbor ratios to gauge tax payments on interstate and international voice calls. On the surface, it seems like a straightforward solution. But this safe harbor option brings about yet another challenge for CSPs: determining if, and when, using the FCC’s predetermined ratios will benefit your business.
