What on earth is a “gross receipts surcharge”?

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The price for service listed on wireless companies’ website is rarely the one you end up paying at the end of the month.

For starters, there are federally mandated charges, plus state and local taxes — as well as surcharges imposed by the carriers as a way to recover the costs of divvying up the money to the required agencies. In fact, there are over 75 different “fees” your carrier can charge, according to wireless comparison site ABTolls.com, and the average U.S. wireless customer pays nearly 18% in federal, state and local fees, according to a November 2015 report by the Tax Foundation.

These extra charges on the rise. The tax rate on cell phone bills has increased nearly three percentage points since 2008, even as the size of the average monthly bill has fallen, the Tax Foundation found. “Taxes on wireless have far exceeded the normal scale, says Kae Zulager, CEO of BillPolice, a service that manages and optimize wireless charges.

Then there are surcharges and fees — items not required by law, but which are charged to the carrier — the federal Universal Service Fund, say — and often passed along to consumers as an extra fee.

Are you stuck with them? In some cases, Zulager says, BillPolice has been able to negotiate a credit on some administrative fees. But the best way to reduce the amount of fees you pay is just to lower your overall spending, she says. “The lower your bill, the lower your taxes are going to be, because a lot of them are based off a percentage of your service charges.”

The first step is knowing exactly what you’re paying. MONEY gathered staffers’ bills from the last month to show you where these fees are hiding on your cell phone bill.

Full Article Here