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Sprint plans to file an appeal

Sprint is in hot water due to unpaid sales taxes, and the carrier is looking at a $300 million lawsuit. 

A lawsuit,  which claimed that Sprint didn't collect or pay taxes properly on wireless calling plans, was filed in New York back in 2011. This cost both local and state governments over $100 million. 

More specifically, wireless carriers are supposed to collect and pay sales taxes on the entire charge for the amount of minutes they sell for fixed monthly wireless plans. Instead of doing this, Sprint dubbed a portion of it as nontaxable and failed to collect about 25 percent of the taxes due to governments. 

New York Attorney General Eric Schneiderman took over the case last year, and now wants $300 million to cover the $100 million lost by state/local governments and for penalties. He said this should be a warning to others that tax fraud will be punished in the state.

“Sprint is disappointed in the court’s decision, and we intend to file an appeal shortly,” said John Taylor, a spokesman for Sprint. “With this lawsuit, the Attorney General’s office is claiming New York consumers, who already pay some of the highest wireless taxes in the country, should pay even more. As we have in the past, we will continue to stand up for New York consumers’ rights and fight this suit.”

New York Supreme Court Judge O. Peter Sherwood denied Sprint's request to dismiss the case on June 27. Another hearing is scheduled for July 24.

Sources: Bloomberg, CNET

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By Reclaimer77 on 7/3/2013 2:42:01 AM , Rating: 3
Sprint paid "their" taxes.

Read the article again. Sprint was supposed to collect some arbitrary BS New York leftist porkbarrel tax from it's customers. Apparently according to this fatcat bureaucrat, Sprint didn't properly apply the tax so New York had a bit less money that they otherwise would have used to flush down the cesspool of corruption and greed that is New York.

Translation: Because of this, your bill was less than it should/would have been. Does that sound "psychopathic" to you?

By gamerk2 on 7/3/2013 3:05:43 AM , Rating: 2
Uh, no, on both counts.

On the first: Sprint's been trying to weasle out of paying their taxes for years, and after all that money Verizon has dumped into the city, or the Dolans (Cablevision/MSG) influence, no way they were getting away with it.

On the second: As a NYker, I expect a certain level of service. I expect the best education system in the US. I expect the best hospitals. The cleanest city. And so on and so forth. And we get it. And when we find out some bureaucrat wasted money, we get 8 newspapers with frontpage headlines, and about 5 different layers of government trying to figure out who's to blame. Sure, it costs a lot, but we get more then enough back in services (education and the like) and salary (average pay: $80k, well above the national average) more then put us ahead of everyone else in the country.

By Solandri on 7/3/2013 4:40:28 AM , Rating: 2
On the first: Sprint's been trying to weasle out of paying their taxes for years

That's his point - Sprint didn't weasel out of anything here. Whether they collected this tax or not makes no difference to their bottom line. Just look at your monthly cell phone bill. They'll charge you $59.99/mo or whatever for service. Any taxes are added on top of that. So Sprint doesn't pay anything here. If the tax is legit, the customers pay.

For whatever reason, Sprint didn't think the tax was legit or thought they were collecting it correctly. So the amount in dispute represents money Sprint's customers didn't pay, not money Sprint is trying to weasel out of and keep for itself.

RE: Why the heck didn't Sprint just pay their taxes?
By Mint on 7/3/2013 12:02:50 PM , Rating: 2
Whether they collected this tax or not makes no difference to their bottom line.
It let them charge less tax than competitors. If one of their customers called AT&T or T-Mobile about switching over and what their bill would be after all taxes, they'd give him a higher quote.

It's like a store advertising "we pay the taxes" to draw customers and get more sales, but in the end they still have to pay sales tax. They just reduce the price by the right amount so that when taxes are added, you get the original price.

By Reclaimer77 on 7/3/2013 12:19:59 PM , Rating: 2
Are you an idiot? Nobody includes taxes in a data plan quote!

The lengths you're going to make Sprint look villainous are absurd. We should cheer any example where the tax burden was reduced. Right or wrong, legal or illegal.

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