Sprint Nextel settles in Missouri for $52.2M

Sprint Nextel Corp. said it agreed pay $52.2 million in back taxes and legal fees to settle tax litigation with scores of Missouri cities, following similar settlements involving other top mobile-phone carriers.
A state court judge must approve Sprint Nextel’s settlement with the Missouri municipalities. The pact also calls for the No. 3 mobile-phone carrier to dismiss all tax-protest lawsuits against the cities.
“While many believe the attempts by Missouri local governments to expand local telephone taxes to the wireless industry violate the state constitution, Sprint Nextel recognizes that it’s in the interest of our customers, our shareholders and the cities to resolve these disputes on terms that are reasonable and fair. That’s why we’ve arranged a settlement with the cities involved in this case,” said Mark Beshears, VP at Sprint Nextel.
AT&T Mobility and Verizon Wireless previously struck deals with Missouri cities costing the top two cellular carriers as much as $76 million and $30 million, respectively, to put the lawsuits behind them.
Sprint Nextel said its Missouri customers will see an increase in their monthly invoices starting in the first quarter of next year.
Sprint Nextel noted that Missouri consumers have the 16th highest wireless tax burden in the nation, citing figures from cellular industry association CTIA. Taxes, surcharges and fees account for about 16.36% of Missouri cellphone bills, according to the trade group.