March 29, 2010

FCC Increases Universal Service Fund Rate to 15.3%

The FCC has announced an increase in the Federal Universal Service Fund (USF) Assessment rate to 15.3% effective this quarter. The USF rate is up from 14.1% last quarter and up from 9% a few years ago.

The Federal Government wants companies to be tax collectors for them but discourages such blatant notifications of a tax increase. They “encourage” carriers to add the tax into their rates or just increase the USF line item on the bill (without too much fanfare, notice or attention) in hopes the customer does not notice.

An interesting aspect of our tax code…

About the Universal Service Fund (USF)

The goals of Universal Service, as mandated by the 1996 Act, are to:
  • Promote the availability of quality services at just, reasonable and affordable rates for all consumers
  • Increase nationwide access to advanced telecommunications services
  • Advance the availability of such services to all consumers, including those in low income, rural, insular, and high cost areas at rates that are reasonably comparable to those charged in urban areas
  • Increase access to telecommunications and advanced services in schools, libraries and rural health care facilities
  • Provide equitable and non-discriminatory contributions from all providers of telecommunications services to the fund supporting universal service programs
The Commission established four programs to fulfill these goals.  They are:
These programs are funded by the Universal Service Fund.  Telecommunications providers must contribute to the fund through an assessment on their interstate and international revenues.  The Commission appointed the Universal Service Administrative Company, or USAC, to administer the four programs and the Universal Service Fund.

Detailed statistical information about the Universal Service Fund is available in the Annual Monitoring Report.
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