Talking Long Distance To Your Family, Friends Could Soon Cost More

There is currently no tax on long distance calls made out of state. One tax closing loophole under consideration in the Senate cuts the rate on in-state long distance calls from 6.5 to 6 percent but would add 6 percent tax on calls you make out of state.

"You're going to pay 6 percent tax on everything -- cellular, whether it's local or long distance or free long distance," says Tom Moore of Sprint.

The charges would apply to pre-paid phone cards, cellular phones and regular telephones. The tax would be included in your purchase price.

The Senate is under pressure to close tax loopholes to help balance the proposed $14.7 billion budget. The telephone tax loophole closing would raise nearly $69 million dollars in the first year.