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Providence Journal Illustration / frank gerardi

Rhode Island’s taxes on wireless telephone bills are higher than those of any New England state, and among the highest in the country.

A new study commissioned by the wireless industry found that state and local taxes on a typical wireless phone bill in Rhode Island account for 14.52 percent of the charges. Including federal charges, total taxes amount to 18.71 percent of the bill.

With the national average wireless phone bill charge of $49.94 a month, $7.25 would go toward taxes in Rhode Island.

Massachusetts taxes on cell phones are the lowest in New England and among the lowest in the country at 5.6 percent. With a typical bill, only $2.80 goes toward state taxes.

The study was commissioned by CTIA-The Wireless Association, a Washington, D.C., trade group that represents the interests of wireless telephone companies, and written by Scott Mackey, a partner and economist with a Montpelier, Vt. consulting firm.

Mackey surveyed taxes on wireless bills in all 50 states and the District of Columbia to bolster the industry’s position that the levies are “excessive” compared with taxes on other goods and services.

“Wireless consumers continue to pay excessive and burdensome state and local taxes on their wireless service, even though economists and policymakers agree that there is no rational economic basis for excessive taxation of the industry and its consumers,” the report said.

Rhode Island’s taxes on wireless phones are the sixth highest of any state in the country, the study found.

Here’s the breakdown: 7 percent goes toward state sales tax; 5 percent is for the gross receipts tax; and 2.52 percent is a fee to support the E-911 system. In addition, 4.19 percent goes toward federal taxes, the same rate across all states.

By contrast, state taxes on a cell phone line in Massachusetts total 5.6 percent, or $2.80 on a typical monthly bill of $49.94, the report said. State sales tax accounts for 5 percent and the 911 fee is 0.6 percent, or 30 cents.

The report argues that many states tax cell phones the same way they tax regulated utilities, such as traditional phone service, even though cell phone rates are not regulated.

One of the reasons that cell phone taxes are higher in Rhode Island, compared to Massachusetts and some other states, is because Rhode Island assesses a 5 percent gross receipts tax on all telecommunications companies, including wireless carriers. Gross receipts taxes, also known as public service corporation taxes, have been on the books in Rhode Island for at least two decades, said Steven Scialabba, chief accountant for the Division of Public Utilities and Carriers. The tax also applies to ferry companies, as well as firms that distribute electricity, natural gas and cable television services.

This tax is assessed, according to state law, “for the privilege of existing as a corporation.”

Another factor that has pushed Rhode Island near the top is its 911 fee.

The monthly surcharge is $1 per line for traditional phones and $1.26 for each wireless phone, each month. The fees are collected by the telephone companies and remitted to the state. The amounts are set by state law.

Rhode Island’s 911 fees amount to 2.52 percent of the total bill, making it the fifth highest in the country, according to the CTIA.

It is topped only by West Virginia (6.01 percent), Alaska (3.4 percent), Georgia (3 percent), and New York (3 percent).

In the other New England states, 911 fees are significantly lower, and among the lowest in the country. Vermont ranks 31st with a charge of 1.25 percent; Maine ranks 39th with 1 percent; New Hampshire and Connecticut rank 43rd and 44th, respectively, with about 0.8 percent; and Massachusetts ranks 47th, with 0.6 percent.

In fiscal year 2007, Rhode Island 911 surcharges for both wireless and landline phones generated a total of $18.2 million. But the state diverted two-thirds of that money to other spending, a practice that has been going on since at least 1999. Only $5.8 million went to the state’s E-911 operations.

Taxes on wireless phones have become an important source of revenue for the state. There were 797,603 wireless lines phones in Rhode Island at the end of 2006, according to the Federal Communications Commission. At the national average wireless phone bill of $50 a month, residents would have spent a total of a total of $478.5 million on wireless phone service that year. Of that amount, $69.5 million would have gone toward state taxes, and $20 million toward federal taxes.

Jeff Neal, a spokesman for Governor Carcieri, said that the governor had not seen the report. But based on the information provided to his office by The Journal, Neal said “this appears to be another example of how Rhode Island’s taxes are unacceptably high.”

He said, “From the governor’s perspective, this is just one more reason that we need to get state spending under control and in line with our underlying revenues.”

If no changes are made to the state’s current rate of spending, it faces a budget deficit of $151 million this fiscal year, and another $384 million in the next fiscal year that begins in July, Neal said.

Once spending is cut back, he said, “we will then have the opportunity to start bringing down some of our high taxes.

“The first step toward doing that is for the General Assembly to approve the budget Governor Carcieri submitted last month.”

tbarmann@projo.com