Texas Cell Phone Taxes Ranked 10th Highest

Texas consumers face the 10th highest cell phone rate in U.S., according to a new study from the Tax Foundation.

Each state can levy taxes on cell phone service as either a percentage or as a flat rate. Texans pay an average state-local tax rate of 12.43 percent on their bills. The average U.S. consumer pays 16.26 percent of taxes and fees. Nebraska tops the list, followed by Washington and New York.  Oregon pays the lowest state-local taxes

The number of U.S. cell phone users has grown from 55 million in 1997 to 292 million in 2010. The state and local governments have also accompanied this trend with higher taxes.

The study says that states use the fees and taxes to raise revenue in a relatively hidden way. Texas even sued Sprint because the company listed a state tax as a line-item in its bill, rather than hiding it from customers.

--Reported by Ioli Campos