Prepaid cell phones and calling cards to add 911 service charge in 2017

93 cents per purchase

FRANKFORT, Ky. (Dec. 21, 2016) — A law passed in the 2016 legislative session, which goes into effect Jan. 1, 2017, requires retailers that sell cellular phones or calling cards with preloaded minutes to charge an additional flat rate of 93 cents per purchase.

The service charge helps will fund hiring additional 911 operations personnel, developing or upgrading address databases, updating software for computer and phone equipment, improving GIS mapping and radio systems as well as technical training for staff. The charge is comparable to fees that currently appear on customer billings for communications services from traditional wireless providers.

Affected purchases include:

  • Cellular phones preloaded with a set dollar amount for minutes or units of air time, or sold with rebates for air time
  • Calling cards for cellular phones preloaded with a set dollar amount for minutes or units of air time
  • The recharging of a reusable cellular phone calling card
  • The recharging of a cellular phone itself with additional minutes of units of air time

Business must collect the prepaid service charge from the customer at the time of purchase for each item sold at retail. Affected retailers must register for the CMRS prepaid service charge with the Department of Revenue and begin filing returns for each reporting period. The filing schedule is the same as the one for the retailer’s sales and use tax return.

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