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  • New York Suing Sprint for More Than $300 Million


    Everyone has probably heard by now that Sprint is one of the few cellular carriers in the U.S. offering truly unlimited data these days. In that, consumers see a ton of value in their network. One thing you may not have known is that Sprint has also been evading taxes in New York state, failing to bill customers for almost $100 million in taxes over the course of seven years.

    New York Attorney General Eric Schneiderman adds his opinion to the mix, elaborating on how Sprint failed bill taxes on their customers to make their network prices seem cheaper in comparison to competing cellular networks such as AT&T and Verizon, which did bill their customers on taxes. In return for the missing $100 million in taxes, New York state is now Suing Sprint for $300 million in addition to extra damages, which have yet to be publicized.

    Sprint has been going through some rough financial times and was rumored to file for bankruptcy. The deal Sprint signed with Apple to carry the iPhone is certainly one of their biggest assets as the iPhone is their best-selling phone and it is helping to keep the company afloat. The $300 million damage due to their mistake, however, is going to put a dent in their profits for a little while.

    Citing Reuters, Sprint was able to make their cellular service $4.6 million less expensive per month by not making their customers pay taxes. The good news is, New York state is not going after the customers that never paid the taxes, but instead the company itself. In this event, the customers get off without having to pay any taxes on their previous bills.

    Sources: Reuters
    This article was originally published in forum thread: New York Suing Sprint for More Than $300 Million started by Anthony Bouchard View original post
    Comments 26 Comments
    1. RoloDiva13's Avatar
      RoloDiva13 -
      Quote Originally Posted by alanjf View Post
      First of all, I'm not advocating to not pay ANY taxes. But what you need to realize is that so much of what paid in taxes does NOT go to where it's supposed to. It's been recently revealed that as much as 80% of tax money either gets out-right blown on completely frivolous things (such as the recent GSA/Las Vegas scandal where they use nearly a million dollars of our money for parties and hookers) or taken by politicians themselves.

      In other words, if tax money was actually being spent on the things we are told it will be, and not being wasted and squandered, then we wouldn't NEED to be paying so much taxes in the first place.

      This country some how survived for over 150 years before the IRS was invented.

      I'll give you that public officials waste our tax money, but to what extent that happens I wouldn't know so I can't speak to what percentage we could possibly decrease state/local taxes to spend more frugally.

      As far as your assertion about the U.S. 'getting by' just fine before the IRS, you might want to cite some sources, there. From what I found, the Fed has been levying taxes since the Revolution ended, albeit not under the name "Internal Revenue Service" to pay for the Am. Revolution itself, in fact; the Founding Fathers included the proviso allowing Congress to "…lay and collect taxes, duties, imposts, and excises, pay the Debts and provide for the common Defense and general Welfare of the United States." It's true that the Constitution appears to prefer states handle taxation, and since it's STATE taxes at the subject of this story, I'm not sure what your point is about the IRS.
    1. confucious's Avatar
      confucious -
      If Sprint weren't paying tax that was due what on earth are people moaning about? Or do some of you think tax is optional?

      You might disagree with taxes but isn't avoiding taxes illegal in the USA?
    1. alanjf's Avatar
      alanjf -
      Quote Originally Posted by RoloDiva13 View Post
      I'll give you that public officials waste our tax money, but to what extent that happens I wouldn't know so I can't speak to what percentage we could possibly decrease state/local taxes to spend more frugally.

      As far as your assertion about the U.S. 'getting by' just fine before the IRS, you might want to cite some sources, there. From what I found, the Fed has been levying taxes since the Revolution ended, albeit not under the name "Internal Revenue Service" to pay for the Am. Revolution itself, in fact; the Founding Fathers included the proviso allowing Congress to "…lay and collect taxes, duties, imposts, and excises, pay the Debts and provide for the common Defense and general Welfare of the United States." It's true that the Constitution appears to prefer states handle taxation, and since it's STATE taxes at the subject of this story, I'm not sure what your point is about the IRS.
      I agree that it's supposed to be the states that were to handle taxes and that the federal level was never supposed to. But one thing you're missing is that taxes were not mandatory then.
    1. RoloDiva13's Avatar
      RoloDiva13 -
      Quote Originally Posted by alanjf View Post
      I agree that it's supposed to be the states that were to handle taxes and that the federal level was never supposed to. But one thing you're missing is that taxes were not mandatory then.
      Please refer to Congress' Revenue Act of 1861. Along with excise taxes, this also included a 3% income tax on those citizens making $800+ per year. This was the LAW until 1872 but even after the Revenue Act was repealed other excise taxes still existed as a means of internal revenue. From what I've read Congress more or less mainly enacted (income and/or property) taxes when funding for conflicts was needed. At this time period the US military was comprised mostly of militias, and certainly not the industrial war machine it is now. But again, this is federal taxes we're talking about, not state, as is the case in this story.

      The federal government isn't suing Sprint; the state of NY is. If folks think that their state politicians are misappropriating funds then they've got choices: (1) hit the pavement in protest of those currently in office to call attention to the abuses, raise enough of a stink to get the public behind you and come election time vote the greedy b*stards out or (2) MOVE.
    1. PorthosPirate's Avatar
      PorthosPirate -
      Quote Originally Posted by alanjf View Post
      And where exactly does it state that the government is actually entitled to ANY tax revenue at all? News flash: There was no such thing as the IRS when this country first came to be, and not for another 150+ years. If you actually bother to study up on this, you'd find that the IRS and way the tax system has been crafted is actually very illegal and unconstitutional. In fact, what we have today is specifically what the founding father DIDN'T want to happen, which is why there were no taxes, as we known them today, for such a long time. So don't sit the and perpetuate that everyone owes anything to the government, and it's the government that's way too big, spends way too much, and is getting way too deep into people's lives.
      To answer your question:

      "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises..." [U.S. Constitution, Section 8, 1st Paragraph] - Written by the Founding Fathers, in case you missed that with your myopic mind.

      "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration." [U.S. Constitution, Amendment 16 - "Status of Income Tax Clarified" - Ratified 2.3.1913]
    1. alanjf's Avatar
      alanjf -
      Quote Originally Posted by PorthosPirate View Post
      To answer your question:

      "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises..." [U.S. Constitution, Section 8, 1st Paragraph] - Written by the Founding Fathers, in case you missed that with your myopic mind.

      "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration." [U.S. Constitution, Amendment 16 - "Status of Income Tax Clarified" - Ratified 2.3.1913]
      If you read those entire sections, you'll find that there is no mention of them being mandatory. Also, no provision of the Internal Revenue Code requires anyone to file or pay income taxes. This tax, unlike other internal revenue taxes, is strictly voluntary. This is because a compulsory income tax would violate the Constitution's three taxing clauses, the Bill of Rights and the 16th Amendment-all of which impose restrictions on the government's power and ability to tax income in ways few Americans understand. So, in order for the income tax not to be unconstitutional it had to be written on a non*compulsory basis. However, in order to deceive Americans of this, as well as provide federal courts and the IRS with deceptive passages on which to hang illegal prosecutions and illegal seizures, the Internal Revenue Code was written to make paying income taxes appear mandatory.