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The Spanish-American War is Officially Over

Apparently, only now is the US government confident enough in the outcome of the Spanish-American War to nix the luxury tax implemented to finance victory.

The brief Spanish-American War ended more than a century ago, but not the federal tax assessed to fund the victory.

Until now.

On Thursday, the U.S. Treasury said it would stop collecting the 3% federal excise tax on long-distance calls, a fee originally assessed in 1898. The government also said it will issue refunds requested by consumers and businesses that paid the fee over the past three years. Taxpayers will be able to request refunds when they file 2006 tax returns in early 2007.

The Treasury also said the Justice Department would cease litigation in support of the tax after a handful of federal appeals courts ruled the fee illegal in decisions rendered within the past year. The most recent loss in federal court occurred earlier this month.

"The Federal Appeals courts have spoken across the board," Treasury Secretary John Snow said in a statement. "It's time to 'disconnect' this tax and put it on the permanent 'do not call' list."

... In announcing his decision, Treasury Secretary Snow also called on Congress to eliminate federal taxes on local phone calls. That tax is separate from the long-distance fee.

Full story here.
U.S. Treasury Department Press Release here.


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