I live in Indiana
I have a monthly cell phone plan with Virgin Mobile carrier that runs 54.99/mo. With taxes & surcharges it takes me to $62.66. If I elect to automate my monthly payment, this is all I pay.
Similarly, if I did not have a monthly plan and purchased minutes via a retailer or online, I would be charged a 7% sales tax (for my state) on the balance I was purchasing. Seems pretty normal right?
My issue is that I elect to NOT have my payment withdrawn automatically. This protects me in case I may be short on funds that need to be allocated to another expense. I prefer to have the flexibility of risking my service interrupting if I need to wait 24 hours to make payment for example.
The carrier's system auto-generates my acct balance required to continue service to include my plan taxes and surcharges totaling $62.66. There only option to cover this balance is their "top up" payment protocol. This "traditionally" would be used for someone who is not on a monthly plan and needs to add minutes, thus a sales tax would be applied to their purchase balance.
My issue is that I'm being doubled taxed. I'm required to enter a top up amount equal to my acct balance. Thus I'm being charged a 7% sales tax on $62.66 which already includes taxes & surcharges applied to my monthly plan. So I end up paying $67.05 when it's all said and done.
Their payment system obviously cannot differentiate between a monthly plan customer vs. a non-monthly plan customer as I'm not buying $62.66 worth of minutes to render this additional tax. I also can't "top up" just my base plan amount of $54.99 in anticipation of this additional tax, as only this amount will be credited to my acct and won't compensate for the original taxes & surcharges that were already applied.
I'm no legal expert, but I can't seem the legitimacy of taxing tax. If they were administering a service or "merchant fee" to process the payment, this would be different, but it is not the case.
Can they do this? Is it legal?
I have a monthly cell phone plan with Virgin Mobile carrier that runs 54.99/mo. With taxes & surcharges it takes me to $62.66. If I elect to automate my monthly payment, this is all I pay.
Similarly, if I did not have a monthly plan and purchased minutes via a retailer or online, I would be charged a 7% sales tax (for my state) on the balance I was purchasing. Seems pretty normal right?
My issue is that I elect to NOT have my payment withdrawn automatically. This protects me in case I may be short on funds that need to be allocated to another expense. I prefer to have the flexibility of risking my service interrupting if I need to wait 24 hours to make payment for example.
The carrier's system auto-generates my acct balance required to continue service to include my plan taxes and surcharges totaling $62.66. There only option to cover this balance is their "top up" payment protocol. This "traditionally" would be used for someone who is not on a monthly plan and needs to add minutes, thus a sales tax would be applied to their purchase balance.
My issue is that I'm being doubled taxed. I'm required to enter a top up amount equal to my acct balance. Thus I'm being charged a 7% sales tax on $62.66 which already includes taxes & surcharges applied to my monthly plan. So I end up paying $67.05 when it's all said and done.
Their payment system obviously cannot differentiate between a monthly plan customer vs. a non-monthly plan customer as I'm not buying $62.66 worth of minutes to render this additional tax. I also can't "top up" just my base plan amount of $54.99 in anticipation of this additional tax, as only this amount will be credited to my acct and won't compensate for the original taxes & surcharges that were already applied.
I'm no legal expert, but I can't seem the legitimacy of taxing tax. If they were administering a service or "merchant fee" to process the payment, this would be different, but it is not the case.
Can they do this? Is it legal?
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