The Universal Service Charge (USC) is imposed on consumers as a means to fund improvements to broadband Internet service in Vermont and to keep it affordable for Vermonters. The charge is calculated as 2.4% of the retail charge on all wireless telecommunication sales and is in addition to the state sales tax.
What has Changed
Under Act 79 of 2019, sellers of prepaid calling cards for wireless communications must collect the USC of 2.4%. This changes the responsibility of collecting the USC from the telecommunications service provider to the retail seller. If the telecommunications provider is the retail seller, then it must collect and remit the USC. Vermont lawmakers made the change to better conform to federal requirements.
How to File and Pay
The law becomes effective on Jan. 1, 2020. The first filing should be for sales made beginning January 1.
Sellers must file and pay the USC online to the Department of Taxes at myVTax at the same frequency they file and pay the Vermont Sales and Use Tax.
The first time you file and pay the USC using Form SUT-451, Vermont Sales and Use Tax Return, on myVTax you will be asked whether you collect the USC. Check the “YES” box and follow the prompts to pay the amount of USC you’ve collected during the filing period. You will not be asked this question again the next time you file. If you no longer sell calling cards and do not collect the USC, you may change your response to “NO.”
Forms and Publications
| Number | Instructions | Title |
|---|---|---|
| SUT-451 | Instructions | Vermont Department of Taxes Sales and Use Tax Return |
Frequently Asked Questions
Who must file?
Any retailer of prepaid wireless telecommunication services, including all retailers of prepaid wireless calling cards, must file and pay the USC.
When must I begin filing and remitting?
Act 79 of 2019 switched this charge from service providers to retail vendors effective for returns filed after Jan. 1, 2020.
Are there any exceptions allowed?
If a minimal (less than 10 minutes or $5.00) amount of prepaid wireless telecommunications service is sold with a prepaid wireless device for a single nonitemized price, the USC can be excluded from the transaction.
All exemptions under Vermont law at 32 V.S.A. Chapter 233 “Sales and Use Tax” apply to retail sales of wireless telecommunications services, including prepaid calling cards.
Are there penalties for failure to remit?
Yes, retailers who fail to report or who provide false or inaccurate information may be subject to penalties.
Will my sales data be shared with the public?
Data will only be shared in an aggregated form that does not identify individual filers.