Taxes Surcharges and Fees
Except for NetDiverse’s net income tax, Customer is responsible for all taxes, fees, surcharges, license fees and other tax like charges imposed on or incident to the provision, sale or use of Service (whether imposed on NetDiverse or its affiliates) Such charges may be billed as cost recovery fees. Valid exemption certificates will be given prospective effect upon receipt by NetDiverse.
In this document, we attempt to explain the basic taxes, sucharges and fees that may apply to Customers’ Services. This is not a complete list of all taxes, surcharges and fees that may apply, and the taxes surcharges and fees may change without notice.
Internet Access Universal Service Fund (USF) Recovery Fees:
NetDiverse’s underlying carriers providing Internet Access currently charge USF fees to NetDiverse for the provision of the access circuits. Typically, these charges are 14-16% of the access fees, or the same rate as our VoIP USF Recovery Fees. Since the carriers only charge us this fee on a portion of our access network we charge a smaller amount of this fee on Internet Services. Our current rate is 5% and is applied to all of our Internet Service products in all jurisdictions.
Please note: We do not currently charge any additional surcharges and fees on Internet Services, and there is currently a federal law that prohibits states and other jurisdictions from taxing Internet Services and other information services. If this law changes, taxes for Internet Services will like increase significantly.
VoIP Services Federal and State Universal Service Fund (USF) Recovery Fees:
Other than Internet Services, as outlined above, NetDiverse charges a VoIP Services Federal USF Recovery Fee on all Interstate services such as Long Distance. Beginning on May 1, 2012, the VoIP Services Federal USF Recovery Fee will also apply to local VoIP Services based upon the FCC calculations for determining the amounts owed in lines 404.4 and 404.5 of the FCC Form 499A. This percentage, for the months of April – June 2012 is equal to 17.4%(USF rate) times 64.9% (FCC Safe Harbor LD v. Local Percentage) or 11.3%. In some states, a State Universal Service Fund (USF) Recovery Fee may also apply to Intrastate services which may include local VoIP trunking and Intrastate Long Distance.
Federal and State USF Recovery Fees align with the fees outlined by the FCC or State and are typically changed quarterly.
Federal Excise Tax Recovery Fees:
Net Diverse is considered a Interconnected VoIP provider and purposefully is not considered a “telecommunications provider” by the FCC. As such, NetDiverse pays its underlying carriers Federal Excise Tax rather than paying this directly to the IRS. Therefore, NetDiverse charges a Federal Excise Tax Recovery Fee equal to the Federal Excise Tax rate outlined by the IRS on our local VoIP trunking products including, but not limited to, SIP trunks, Concurrent Call Paths, and DIDs.
The current Federal Excise Tax Recovery Fee, as of March 2011, is 3%. This tax remains fairly consistent from the IRS.
State, County, and Local Taxes and Fees:
The following taxes and fees may be applied to a variety of products and services in each state or local jurisdiction pursuant to their laws and rules.
Sales Tax, E911 Fees or Taxes, Franchise Fees (service/revenue specific), Excise Taxes, Gross Receipts Tax, etc… NetDiverse will charge these taxes, surcharges, and fees to our customers and remit these taxes, surcharges and fees to the underlying jurisdictional authority charging for these fees. For more information on specific taxes and fees, please email email@example.com