A December proposal by the European Commission to impose a 3.7 percent tax on GPS-enabled mobile phones and a 14 percent tax on mobile TV-enabled phones has been halted. In a European Union Customs Committee Meeting earlier this week, the majority of EU countries voted to overturn the proposal as did the number one cellphone manufacturer in the world, Nokia, and Sony Ericsson.
The December proposal sought to reclassify mobile phones with GPS or TV receivers as “multi-functional devices,” a classification that would allow the import tax to be charged. But with mobile phone sales expected to drop over the next 5 years, a tight economy and GPS receivers increasingly being built into mass market phones, the new classification would have undoubtedly hurt the industry.
