Important Notice for California Prepaid Wireless Customers
New Information - Recent Court Decision: On November 15, 2018, the United States District Court, Northern District of California (MetroPCS California, LLC v. Michael Picker, et al, case number 17-cv-05959-SI) enjoined state agencies from enforcing the provisions of the Prepaid MTS Surcharge Collection Act because it conflicts with federal law. A notice of appeal of the district court's decision was filed on December 14, 2018, but a judicial stay of the injunction was not requested, thereby ending the California Department of Tax and Fee Administration’s (CDTFA) enforcement of the Prepaid MTS Surcharge Collection Act.
Effective January 1, 2019, Prepaid Wireless Carriers shall collect, report and remit the California Public Utilities Commission’s Public Purpose Programs (PPP) surcharges and User Fees on charges for intrastate telecommunications services, from consumers when prepaid wireless services are purchased in California, instead of the California Mobile Telephone Surcharge (MTS), which previously applied to the purchase of prepaid wireless services.
The following percentages for the PPP Surcharges and User Fees, of the sales price of prepaid services, will be applied as follows:
- Universal Lifeline Telephone Service (ULTS) - 4.75% as adopted in Resolution T-17519
- Deaf and Disabled Telecommunications Program (DDTP) - 0.5% as adopted in Resolution T-17458
- California High Cost Fund-A (CHCF-A) - 0.35% as adopted in Resolution T-17453
- California High Cost Fund-B (CHCF-B) - 0.00% as adopted in Resolution T-17417
- California Teleconnect Fund (CTF) - 0.78% as adopted in Resolution T-17606
- California Advanced Services Fund (CASF) - 0.56% as adopted in Resolution T-17593
- California Public Utilities Commission User Fee - 0.33% as adopted in Resolution M-4832
To help you understand your total charges due to the invalidation of the MTS, please note the following example. If you were to purchase $20.00 in prepaid wireless service on or after January 1, 2016 and before December 31, 2018, in a locality where the Prepaid MTS Surcharge rate is 10%, you will pay $20.00 for service plus a $2.00 surcharge (i.e., $20.00 X 10%) for a total of $22.00. The amount of the Prepaid MTS Surcharge would vary because some cities and counties did not impose a Utility User Tax or a local 911 Charge and cities and counties with Utility taxes or Local 911 Charges had different rates. Effective January 1, 2019, if you were to purchase $20.00 in prepaid wireless service, you will pay $20.00 for service, plus $1.45 for surcharges and fees, (i.e., $20.00 X 7.27%) for a total of $21.45.
You can find additional information about the invalidation of the MTS Surcharge by going to the following website http://www.cdtfa.ca.gov/industry/prepaid-mts-surcharge.htm or by contacting at Airvoice Wireless at 1-888-944-2355.
Updated December 31, 2018, 12:00pm PST