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Many Economists Ignore Drop in Biz Expenses

Economists have yet to catch on to the significance of the recent IRS action ending the 3% Federal Excise Tax (FET) levied on many telecommunications services. They are also ignoring the significance of the IRS offer to refund $14.5 billion to individuals and businesses. Telecommunications expenses are one of the top five expense categories for businesses in America today. In a weekly newsletter, Bob Schwartz, ?The Phone Tax Refund Guy? and CEO of Bill Correctors, Inc., calls the elimination and subsequent refunding of the FET: ?The Great Federal Excise Tax Refund?.

?I haven?t heard anyone call this a `Great` event, and it represents a significant reduction to a major cost for many US firms. Businesses like 1.800.FLOWERS, telemarketing firms, and others with heavy long distance or cellular usage will get an ongoing boost to their bottom line from this new 3% cost reduction," Schwartz says.

In his newsletter, Schwartz continues: ?The refund process is complex and time consuming because impeccable documentation will be required. Determining the exact amount paid involves retrieving old phone bills, reading them, finding relevant charges on at least 2 or 3 lines of the bill, making calculations, and tallying the results by vendor quarterly, for each bill from the past 41 months. I?m amazed that economists have dropped the ball on this one. Stock values should be affected by the elimination of the tax, and a $14.5 billion infusion of cash into the economy should make a difference somewhere.?