Per Line Taxes

The IDI platform's Per-Line tax feature helps service providers accommodate the various rules that taxing authorities use to calculate Per-Line Tax obligations for single line and multi-channel services.

Per-Line taxes can be configured as a flat fee or a tiered tax based on the number of active services or lines assigned to a tax jurisdiction. Per-Line tiered taxes work by counting a customer’s taxable lines and  applying a rate based on which tier the count falls into. For example, tier 1 might cover lines 1–10 at one rate, tier 2 covers 11–50 at a higher rate, and so on.

These taxes are assessed in addition to product and usage charges, but they are not calculated on those charges.

Depending on the service type, a taxable unit may be treated as either a single line or multiple channels. For example, a POTS service is treated as a single line with a count of one. By contrast, a T1 service contains 24 channels and may be taxed either as a single service or on a per-channel basis, depending on the jurisdiction.

IDI tax logic determines whether a service is assessed as a single line or by individual channel. For service types such as Default, PBX/Trunk, and Centrex, only the Per-Single Line values for Inbound Voice, Outbound Voice, and Data are configured. During tax calculation, the system evaluates the service’s characteristics and applies only the applicable tax rules. In most jurisdictions, Per-Line assessments apply only to outbound voice services; inbound-only and data-only lines or channels are generally exempt from Per-Line taxes.

For service types such as PRI and OtherMultiChannel, both Per-Single Line and Per-Channel values must be configured. During tax calculation, IDI evaluates the jurisdiction associated with the service and determines which assessment method applies. For example, some California municipalities assess a T1 service as a single line and impose a single flat tax amount. In most other jurisdictions, however, the assessment is applied on a per-channel basis, resulting in taxes being calculated across all 24 channels.

Managing Per-Line Taxes involves three areas of the IDI platform:

• Tax Management – Tax administrators configure local taxes that assess Per-Line charges for applicable service types.

• Product Management – When a product specialist creates a new service or edits an existing one, and the Service Tax Class = Local or VOIP, an additional tab is available where the following Per-Line Tax parameters can be configured:

  • Number of lines or channels provided by the service, if applicable.

  • Voice/Data and Inbound/Outbound attributes for each channel.

  • Default Voice/Data and Inbound/Outbound attributes.

  • Service's Per-Line Tax  Class.

Note: All other services in the Product Catalog default to single service line taxing and the Default Per-Line tax class.  This allows any other service to apply to a per line tax if one is created that targets the tax class of that service.

• Customer Management (Desktop Client or Customer Care) – When a service with a Local or VOIP tax class is assigned to a customer, the service's default Per-Line tax  configuration is inherited from the Product Catalog. Authorized users can override the default configuration on each service.

The tax engine uses these configurations to determine when a Per-Line tax applies and whether it should be assessed at the service level or channel level based on the service configuration and the applicable tax jurisdiction.

Note: This article covers tax management guidelines that apply specifically to Per-Line taxes. For more on general tax management guidelines, refer to related articles in the Knowledge Center.

Configuring Per-Line Taxes in Desktop Client Tax Management

Authorized tax administrators can access Tax Management in the IDI Desktop Client via Applications > Tax Management > Taxes.

Add/Edit Per-Line Taxes at the county-level. Configure each section of the Add/Edit Tax form as described below.

This tax is a

• Select Per-Line Tax as well as any of the other options that may apply. Note: If you select Percentage Tax in combination with Per-Line Tax, Tiered Tax MUST also be selected as the system does not support a non-tiered Per-Line/Percentage Tax.

Per Line Tax Configuration

• In the Per-Line Tax  Configuration section choose one or more of the following:

Note: A tax may be specified as Per-Single Line, Per-Channel, or both. If a tax that is both Per-Single Line and Per-Channel is applied to a service that has been configured for both, the Per-Channel taxing method will be applied.

Per Line Tax Class

• First choose one or more Per-Line Tax Classes. Note: Available Tax Class options vary depending on the option(s) selected for Per-Line Tax Configuration (above):

• Then choose:

Flat Fee or Tiered Tax

The Tax Rates (Flat Fee) section is enabled and applicable for all selections in the This tax is a section, except when Tiered Tax is selected.

• Refer to the article on Flat Fee options to configure a flat fee.

• For Tiered Per-Line Tax:

  • When you add/edit tiers, the Max Lines value on each tax tier defines where that tier's threshold sits.

  • The Apply Tiers Per-Service setting specifies how you count lines to determine which tiers apply.

    • Off (default) - All eligible lines across the account are pooled into one count, and that single account-wide total is checked against the tier thresholds. One tier assignment applies to everything.

    • On - The line count and tier lookup are done separately for each service rather than aggregated at the account level. So a customer with several services, each with its own line count, would have each service independently evaluated against the tier table rather than having all their lines added together first.

Per-Line Tax Configuration on Services in the Client Product Catalog

A Per-Line Tax Configuration tab is available on services when the Service Tax Class is set to Local or VOIP. Note: All other services in the Product Catalog default to single service line taxing and the Default Per-Line tax class.  This allows any other service to apply to a per line tax if one is created that targets the tax class of that service.

Note: For new implementations, it is recommended that you work with the IDI project management team to set this up. After that, you can maintain this setup as needed.

Fields for Per-Line Tax Configuration tab:

Notes:

• If both Enable Per-Single Line Taxing and Enable Per-Channel Taxing are unchecked, it means that no Per-Line Taxes will be applied to this service.

• A tax may be specified as Per-Single Line, Per-Channel, or both. If a tax that is both Per-Single Line and Per-Channel is applied to a service that has been configured for both Per-Single Line and Per-Channel, the Per-Channel taxing method will be applied.

A Context (right-click) menu provides options for editing, adding, and deleting channels.

Customer Management – Desktop Client or Customer Care

For instantiated services on an account where the tax class is Local or VOIP, customer service representatives (CSRs) can view and manage the Per-Line Tax configuration.  The default configuration is inherited from the Product Catalog; however, CSRs can override the inherited configuration as needed.

In Desktop Client Customer Management, a Per-Line Tax Configuration tab is provided for this.

In Customer Care, on the account’s Services and Features page, select the service, then choose Tax Information from the View menu.

This view provides an additional Per-Line Tax Configuration section.

In either case, the Per-Line Tax Configuration section provides an option to override the inherited settings. Checking this option enables the Per-Line-Tax Configuration fields which are the same as provided in the Product Catalog configuration form.

A Context (right-click) menu provides options for editing, adding, and deleting channels.

Fields for Add Edit Per Line Tax Channel form:

Note: You must check at least one of Voice/Data, and at least one of Inbound/Outbound.