Chula Vista Settles Class Action Lawsuit for Wireless Phone Tax and Reduces Tax Rate from 5% to 4.75%
A class action settlement has been reached between wireless phone users and the City of Chula Vista. Per the settlement terms, the City made $8 million available to fund rebates and refunds of the City’s Telephone User’s Tax (TUT) and payment of litigation expenses and attorneys’ fees. In addition, the settlement required the City to reduce the TUT rate from 5% to 4.75%, effective March 1, 2014.
Rebate checks have been issued and the TUT tax rate has been reduced. The City's TUT ordinance is in effect and the tax will continue to be collected.
The lawsuit, Carla Villa, et al. v. City of Chula Vista, was brought by two Chula Vista residents on behalf of Chula Vista taxpayers and was filed by the San Diego law offices of Casey Gerry and the Newport Beach offices of Capretz & Associates. The City of Chula Vista disagreed with the lawsuit’s claim that certain aspects of the tax are unlawful, but, because the issues are complex and continued litigation would be expensive, the City believed it was in the best interest of its citizens to settle the case.
Cash Rebates (Claim Period is Now Closed)
The settlement made cash rebates available to Chula Vista wireless phone users who paid taxes on their wireless phone bills from April 2010 through April 2013. Additional information about the settlement and claim process is available at http://www.chulavistacellphonetaxsettlement.com.
If you have questions regarding your rebate, please contact the Settlement Claims Administrator
- View the Administrative Ruling reducing the rate here.
- An updated Utility Users' Tax Remittance form can be accessed here.
- The City will clarify how its Telephone Users' Tax ordinance applies to wireless phone services.