Understanding Taxes, Surcharges, and Fees

In addition to the monthly service charges billed for Plivo services, your monthly invoice may incur surcharges, taxes, and fees based on the type of service you have and your geographical location, among other factors.  Certain taxes, fees, and surcharges may show up as separate line items on your invoice.  Examples include, but are not limited to the following

Federal Communications Program Fees

Carrier Cost Recovery Fee (CCRF)

A Carrier Cost Recovery Fee (CCRF) equal to a fixed percent of invoiced charges for voice usage, direct inward dialing numbers (excluding taxes), and Zentrunk usage applies to all customer invoices. It is neither government-mandated nor a tax but rather a permissible pass-through charge we use to recover our costs associated with federal regulatory fees. It includes contributions Plivo is obligated to make to federal funds like the Telecommunications Relay Services (TRS) fund and the Universal Service fund (USF). 

The TRS fund was established by the FCC in 1993 to reimburse TRS providers for the cost of providing TRS services — telephone transmission services that provide hearing- or speech-challenged individuals with the ability to use a traditional telephone. The contribution percentage for TRS varies annually. The FCC recently announced that TRS contribution obligations will be extended to intrastate revenue as well. 

The FCC established the USF to subsidize telephone service to low-income households and high-cost areas. USF contribution is only applicable to interstate revenue. The contribution percentage for the USF is published quarterly by the FCC.

Under the FCC's rules, Plivo must contribute a percentage of its interstate and international end-user communications revenues to the TRS and USF funds. We recover this cost through the CCRF.

Carrier surcharge fee

SMS Carrier Pass-Through Fees

Some US and Canada carriers levy a per-message surcharge for message traffic sent and received on their networks. The surcharge varies depending on the message traffic type (SMS or MMS) and the number type (long code, toll-free, or short code). One carrier may charge fees on outbound MMS messages and another on messages originating from or terminated on short codes, or both. Plivo’s US and Canada pricing pages show the specific fees.

Plivo passes these carrier surcharge fees on to each customer as-is without any additional markup. In addition to the surcharges, Plivo gets charged an additional credit card processing fee for each customer recharge and payment, and we pass this credit card processing fee of 3% for the total carrier surcharge amount on to customers to recover the cost of credit card fees.

Here’s an example of how we itemize carrier surcharge fees.

Screen_Shot_2021-11-08_at_2.44.10_PM.png

State and Local Taxes and Surcharges

State and Local Sales and Use Taxes

Almost all states impose some form of state-level sales and use tax.  The sales and use tax is generally imposed on the sale or use of the tangible personal property and certain services.  These taxes are intended to be passed on to consumers. 

In many states, local jurisdictions also impose a sales or use tax.  In some instances, the local sales and use tax is administered by the local jurisdiction. In other instances, the state administers the local sales and use tax.

Certain exemptions apply for sales for resale and sales to certain types of entities, including the federal government, state and local governments, and nonprofit entities.

Plivo collects applicable sales and use taxes as required by state and local law.

Communications Services Tax

Some state and local jurisdictions impose communications-specific taxes on communications services in addition to or in lieu of sales or use tax. The communications services tax is intended to be passed on to consumers. The rates for communications services taxes are usually different from the sales and use tax rates and vary by jurisdiction.

Certain exemptions apply for sales for resale and sales to certain types of entities, such as the federal government, state and local governments, and nonprofit entities. 

Plivo collects applicable communications services taxes as required by applicable state and local law. 

Gross Receipts Taxes

A number of states impose a gross receipts tax on communications service providers. In some states, gross receipts taxes are intended to be passed on to consumers. In other states, the gross receipts tax is the responsibility of the seller, and there is no pass-through to the end user.

Certain exemptions may exist for gross receipts taxes that are intended to be passed on to the customer, based on the type of entity making the purchase, including the federal government, state and local governments, and nonprofit entities. 

Plivo pays gross receipts taxes and collects them from customers when required (or permitted) by applicable state and local law.

Local Utility Taxes

Local utility taxes are imposed by cities and counties in a select number of states. Certain exemptions may apply for sales for resale and sales to certain types of entities, such as the federal government, state and local governments, and nonprofit entities.

Plivo pays local utility taxes and collects them from customers when required (or permitted) by applicable state and local law.

Local License Taxes

Local license taxes are imposed by cities and counties in a limited number of states.

Certain exemptions apply for sales for resale, and sales to certain types of entities, such as the federal government, state and local governments, and nonprofit entities.

Plivo pays local license taxes and collects them from customers when required (or permitted) by applicable state and local law.

 

Was this article helpful?
0 out of 0 found this helpful
Didn’t find what you are looking for? Create new ticket