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CPUC Withdraws Plan to Tax Text Messaging Following Federal Ruling

Following a federal regulatory ruling, California's Public Utilities Commission (CPUC) is no longer pursuing a plan to place a tax on text messages. On Friday, state regulators announced that they were withdrawing the proposal “in light of” the Federal Communications Commission’s declaratory ruling classifying text messaging as information services, rather than telecommunications services. In their statement, the CPUC noted that the Federal Telecommunications Act limits state authority over information services.

The CPUC proposal would have assessed Public Purpose Program surcharges on text messaging services, including both Short Message Service (SMS) and Multimedia Messaging Service (MMS). The plan, which the CPUC was set to vote on in January, drew harsh criticism from the wireless industry and business groups, who have argued, among other things, that taxing text messages is bad for consumers.