VoIP: Not a ‘Taxing’ Solution

Every company wants to save money. It’s how that presents a challenge. As the calendar flips from 2012 to 2013 and business owners look ahead to a new year, it could be time to make the switch to VoIP to see cost reductions in areas such as the three below.

VoIP not a taxing solutionTaxes

First, the bad news: There will be some tax included on a company’s VoIP bill. The good news? You’ll probably pay far less tax on a VoIP service than a traditional landline. There’s a minor tax mandated by the Federal Communications Commission that applies to all telecommunications providers, and there are some state and local taxes you’ll probably pay as well. You may also pay some fees. Some states charge an e911 fee, for example, so that you can dial emergency services via VoIP just as you would from a traditional phone.

To determine the exact tax savings that you could see from switching to VoIP, it’s best to get in touch with specific providers in your area. Different locales will be governed by different tax laws, and the tax code as it relates to VoIP is still being developed. This is an issue that goes beyond state and even national boundaries, as countries around the world grapple with the question of how the internet should be governed and whether there should be any taxes at all on information – including voice communication – that travels via the web. There’s a final bit of good news, though. Because the taxes associated with VoIP have been so low, VoIP providers are under pressure to contain these costs to remain competitive. As The CommLaw Group and TaxConnex put it in a white paper: “Success in the VoIP services industry will be achieved by those who understand the regulatory and tax environment and develop and maintain strategies to minimize the cost and complexity of those environments.”

No more per-minute charges

Can you imagine being charged per letter or word to send an email? Then why should you be charged per minute to make a phone call, when you can use the Internet to make a call as easily as you use the web to send emails? This is the beauty of VoIP. Calling other VoIP numbers is generally free of charge, and it’s inexpensive to call landlines and even mobile phones.

More functionality, less maintenance

There’s only so much that a traditional landline phone can do. And all these standard features, such as call forwarding, conference calling and voicemail, are also available on VoIP phones. But because VoIP is internet based, it is often part of a more robust package of unified communications options that include video conferencing and presence features. A single phone number might be connected to an employee’s smartphone and work computer – be it a desktop, notebook or tablet – increasing productivity even as costs are coming down. And because phone systems can leverage the power of the cloud, it’s possible to get all these features without having to install and maintain expensive hardware at the office. Instead, the provider can manage the whole system from a hosted location.

About the author: