Communications tax

Struggling to keep up with industry changes? We’re here to help.

Industry transformation can impact taxes

New technology. M&A activity. Changing legislation. Whether you’re a wireless or cable provider accustomed to telecom tax, you provide streaming or IoT services, or you’re just entering this daunting new world, you need to be certain you’re keeping up with potential tax implications.
 

Find out how

It's a complex ecosystem – and so are taxes
5G is really here

It’s opening a new world of connected services for both consumer and business applications. Many of these offerings are in industries with little or no communications tax familiarity. 

Nothing is clear-cut

Even in wireless and cable industries well-versed in communications tax it’s a challenging environment filled with contingencies, exceptions, special cases, and incredibly complex determinations.

Are you compliant?

Does your product have voice? It’s probably taxable. Does it serve video or media? It’s taxable in many places, too. Is there a sensor involved? There’s a good chance it’s taxable. 


Count on Avalara to help you understand what you need to know about communications tax now — and get ready for the future.

Voice demand is in flux

Demand for voice service continues to trend to VoIP. It’s likely 5G adoption will only increase consumer appetite for these more data intensive needs. Understanding when voice is communications taxable is very important since it can be taxed at an extremely high rate. Making sure your systems are configured for accurate records, reporting, and billing is critical, particularly since bundle prices change regularly. Understanding best practices to maintain compliance can be challenging; doing so while remaining competitive is even more difficult.

 

Video is increasingly in demand

Today’s consumers want video and audio content from multiple devices. Video downloads and streaming services are outpacing pay TV subscriptions, with reliance on cable alone becoming a rarity. Cable companies and content providers are launching streaming options, while streaming platforms offer content from multiple providers. Wireless, content, and cable partnerships are common. Bundles change frequently and may often be paired with voice. It’s an incredibly complex tax environment, especially for businesses new to communications tax.

Tech or connectivity may mean tax

If you sell anything that can be described as XaaS, hosting, internet connectivity, hardware with a telecom service, or a device or service that utilizes a sensor, there’s a chance you may be responsible for communications tax. This includes a big slice of 5G-powered IoT. The fastest growing areas with communications tax responsibility are B2B applications in automotive, agriculture, and manufacturing. It’s always best to ask an expert to make sure you’re compliant, especially since this area will likely see future legislative and regulatory changes.

Meet the challenges head-on
How Avalara works

Avalara for Communications simplifies tax compliance for an increasingly complex industry.

 

Avalara AvaTax for Communications

Connects directly to your billing or ERP system to calculate taxes and fees for communications services.

 

Avalara Returns for Communications

Handles return preparation, files on your behalf, and remits payments to the appropriate jurisdictions.

Blogs

Sensors are changing the world — and likely your taxes
Sensors are changing the world — and likely your taxes

While a lot has changed, one thing hasn’t: As companies roll out IoT applications, they need to consider the tax implications.

Tony Susak | Aug 15, 2019
Federal Universal Service Fund contribution increased by 30 percent
Federal Universal Service Fund contribution increased by 30 percent

It’s important to understand what the FUSF is, why it’s increasing, and how FUSF contributors should ensure they’re following contribution management best practices.

Toby Bargar | Jul 8, 2019
Bundling 101: What you need to know
Bundling 101: What you need to know

The tax complexity involved with bundling services is challenging, especially for new players entering the space, but can be addressed with proper documentation, planning, and coordination.

Toby Bargar | Jun 28, 2019
Why taxing digital content is so complicated
Why taxing digital content is so complicated

While digital content taxation will likely continue to undergo change for some time, there are some precautions you can take to minimize your exposure as you sell these products.

Toby Bargar | Jan 29, 2019
#MWCA2018, 5G, and taxes – Let’s talk about the future
#MWCA2018, 5G, and taxes – Let’s talk about the future

The arrival of 5G has brought the communications industry to an inflection point. But what does all of this mean for taxes?

Tony Susak | Sep 20, 2018
SD-WAN providers: Are you prepared for potential telecom taxation?
SD-WAN providers: Are you prepared for potential telecom taxation?

If you're thinking of expanding your services to include SD-WAN, consider the potential impacts and complexities of telecom taxation.

Toby Bargar | Sep 7, 2018
Unified Communications and communications tax: what UC providers need to know now
Unified Communications and communications tax: what UC providers need to know now

Unified Communications simplifies team collaboration, but for providers can open the door to an incredibly complex array of communications taxes and federal regulations. Here's what you need to know.

Tony Susak | Aug 29, 2018
Vehicle telematics and communications tax: What's next for the consumer auto industry?
Vehicle telematics and communications tax: What's next for the consumer auto industry?

There are many tax implications vehicle manufacturers and telematics service providers need to be aware of. Here's what every consumer segment tax team needs to know to stay competitive and compliant.

Tony Susak | Aug 7, 2018
OTT impacts of Supreme Court repeal of physical presence precedent
OTT impacts of Supreme Court repeal of physical presence precedent

In the wake of South Dakota v. Wayfair, the impacts for OTT providers could be significant. Here's what you need to know about the potential implications for streaming voice, video, and audio services ... Continued

Toby Bargar | Jul 9, 2018
Netflix taxes coming soon to a screen near you
Netflix taxes coming soon to a screen near you

Tax laws are being adapted to account for newer technologies, like streaming services.

Gail Cole | Jun 25, 2018

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