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Rahm's Bid to Hike Cellphone Tax Ripped by Critics

By Ted Cox | May 27, 2014 5:29pm
 Mayor Rahm Emanuel wants to hike the monthly tax on cellphones.
Mayor Rahm Emanuel wants to hike the monthly tax on cellphones.
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CITY HALL — The mayor is appealing to Springfield to raise the city tax on cellphones.

Mayor Rahm Emanuel is reportedly seeking a hike in the city cellphone surcharge from $2.50 to $3.90 a month and needs approval from the General Assembly.

The tax revenue goes to Chicago's 911 emergency service, and the mayor seeks the additional revenue to pay for enhanced services.

According to the Citizens Utility Board, Chicago's 911 surcharge is capped by the General Assembly at $2.50 a month for each wireless line. Mayoral spokeswoman Kelley Quinn said the surcharge is set to expire July 1, and the city is proposing the hike with an extension.

The Chicago-based Heartland Institute, which describes itself as a "free-market think tank," immediately lashed out at the proposal, saying the 56 percent increase would make Chicago's cellphone tax the highest in the nation.

"More than 20 percent of the cost of wireless phone service in Illinois already goes to taxes, one of the highest wireless-phone tax burdens in the United States, and Mayor Emanuel wants to force Chicagoans to pay more?" Steve Stanek, institute tax analyst, said. "And state lawmakers are seriously considering allowing Emanuel to do it?"

Heartland Institute's Matthew Glans said the taxes being proposed would "continue to hinder both Chicago and Illinois' economic competitiveness, further deterring innovation and infrastructure improvements while disproportionately affecting minority and low-income populations."

"Wireless taxes are not a cash cow for government to be used to fuel ever-increasing spending," Glans said. "High wireless taxes have a negative effect on the economy by dragging down both consumers and the wireless market."

The mayor is trying to push through the hike before the end of the General Assembly session on Saturday.