The U.S. Treasury department laid to rest a long-cherished friend today. The federal excise tax on long-distance phone calls was officially declared dead by Treasury Secretary John Snow. The tax was first enacted in 1898 as a temporary measure designed to “soak the rich”. Along the way it has managed to soak the middle-class, the poor, the indigent, and the homeless.
This tax, sadly, outlived my grandfather. He saw long-distance service go from an expensive luxury to something that cellular companies gave away as a free benefit. Nevertheless, the federal government continued to tax everyone who used long-distance service as part of “the rich”.
Keep that in mind the next time someone wants to tax “the rich”. In another generation or two, we might all be “the rich”.