Last reviewed on May 2026
Florida’s Communication Services Tax is a tax applied to the routing of voice, data, audio, video, and other information or signals. It operates separately from Florida’s general sales tax, meaning Communication Services Tax (“CST”) has its own rates, exemptions, and filing requirements. For telecom providers, cable and satellite companies, streaming platforms, VoIP providers, and SaaS businesses offering communication features such as video, CST is a distinct compliance obligation, and one that the Florida Department of Revenue is beginning to audit more aggressively.
Understanding whether your product or service is subject to CST, what rates apply, and how to file correctly is not a simple exercise. Misclassification is one of the most common sources of audit exposure in this space.
Communication Services Tax is established under Chapter 202, Florida Statutes. It was enacted to impose a tax on the retail sale of communication services in Florida, replacing a patchwork of prior local taxes. CST applies at both the state and local level, with local rates varying by county. CST applies to transmissions of voice, data, audio, video, or any other information or signals. Similar to sales tax, CST is an indirect tax, meaning the tax is paid by the customer to a service provider, who then remits the tax to the state. The filing return for CST is the DR-700016, which is a distinct form from the Florida Sales and Use Tax Return, Form DR-15. These are separate returns with separate due dates, and mixing them up is a compliance error the Department identifies readily.
The types of business the are selling a service or product subject to CST is broader than many expect, and has expanded as the nature of communication services has evolved. The following categories of businesses should evaluate their CST exposure carefully.
Traditional Telecommunications Providers
Landline telephone companies and wireless carriers are squarely within the CST framework. These businesses have generally been compliant for years, but changes in service bundling and technology-driven service migration continue to create classification questions.
VoIP Providers
VoIP services are subject to CST under Florida law. Section 202.11(8), Florida Statutes, defines “communication services” to include the transmission of voice using internet protocol, and the Department has consistently treated VoIP as taxable. Providers that sell VoIP as a standalone service or as a component of a broader platform are required to collect and remit CST.
Cable and Satellite Companies
Cable television and direct broadcast satellite services are expressly covered under Chapter 202. The applicable rates and local surcharges differ from voice services, and providers operating across multiple Florida counties must apply the correct local rate based on the customer’s service address.
Streaming Services
Streaming video and audio services transmitted to Florida subscribers are subject to CST under Section 202.11(9), Florida Statutes, which defines communication services to include one-way transmission of video or audio programming. As technology has changed, and the way people consume content has shifted, the Florida DOR has shifted their position on this topic. The current guidance identifies that streaming subscriptions are communication services taxable under Chapter 202. Businesses in this space that have been reporting under the wrong tax framework, or not reporting at all, face significant back-period exposure.
SaaS Platforms with Embedded Communication Features
Video streaming is the area of greatest emerging risk. Software companies that embed communication features into their platforms, such as in-app messaging, video conferencing, SMS notifications, voice calling, or real-time data transmission, may be selling a communication service as part of a bundled offering. Florida’s bundled transaction rules under Chapter 202 are strict, and a business model where software contains a taxable element cold taint the whole transaction. Meaning, the entire amount billed for the software could be subject to CST.
This intersection of SaaS and CST is also a multistate issue. Many states have adopted varying approaches to taxing communication features embedded in SaaS products, and a Florida CST determination does not answer the question in other jurisdictions. Businesses with multistate operations need to evaluate each state’s framework independently.
One of the most common mistakes practitioners see is treating a communication service as a general sales tax transaction. The two tax regimes are entirely separate, and the differences are material:
• Different rates: CST is imposed at a combined state and local rate and can reach as high as almost 15%. Florida’s general sales and use tax rate is 6%, plus applicable discretionary surtax, but is generally about half the CST rate.
• Different returns: CST is reported on Form DR-700016. Sales and use tax is reported on Form DR-15. Filing CST transactions on a DR-15 is a mistake that can be time-consuming, and costly, to undo.
• Different exemptions: The exemptions under Chapter 202 are not the same as those under Chapter 212. For example, a sale for resale exemption used to make tax-exempt purchases for sales tax purposes, cannot be used by resellers of CST.
How the DOR Audits CST
Florida Department of Revenue audits CST separately from sales and use tax. The process is similar, but the records requested will be different from those produced for a sales and use tax audit. As with sales and use tax audits, the DOR issues a Notice of Intent to Audit Books and Records (Form DR-840) to initiate the process, which triggers a 60-day window for the business to gather and produce records. Early engagement with experienced counsel at this stage is critical. The decisions made in the first 60 days of an audit will shape the outcome of the entire examination.
Penalties and Interest
CST penalties mirror the general penalty structure under Florida law. Failure to file on time results in a 10% penalty with a minimum of $50. Fraud or intentional disregard of the law carries a 100% penalty. Interest accrues at a floating rate set by the state, compounded daily. For businesses that have misclassified their services over multiple years, the combined tax, penalty, and interest exposure can be substantial.
Have a CST compliance question or received a DOR notice?
Florida’s Communication Services Tax is a specialized area of law, and audit exposure in this space can accumulate quickly across multiple return periods. At Ribeiro Law, we work with telecom providers, SaaS companies, and streaming platforms navigating CST compliance questions, audit notices, and voluntary disclosure opportunities. Contact Ribeiro Law today for a free consultation.
Is streaming taxable under Florida’s Communication Services Tax?
Yes, Florida treats any streaming video and audio services as communication services subject to CST under Chapter 202, not as non-taxable digital products under the general sales tax. Streaming providers that have not been collecting and remitting CST should evaluate their exposure and consider a voluntary disclosure.
What is the Florida CST rate?
The state CST rate for most communication services is 4.92%, with an additional local rate that varies by county. The rate can reach as high as almost 15%, though the exact combined rate depends on the customer’s service address. Certain services, including broadband internet access, are subject to a different rate structure. Businesses should not apply a single statewide rate without confirming the applicable local rate for each customer jurisdiction.
Is VoIP subject to Florida’s Communication Services Tax?
Yes. VoIP is expressly included within the definition of communication services under Section 202.11(8), Florida Statutes. VoIP providers selling to Florida customers are required to register with the DOR, collect CST at the applicable state and local rate based on the customer’s service address, and file the DR-700016 return. This applies to standalone VoIP services and to VoIP features embedded within a software platform, subject to the bundled services analysis discussed above.
How do I file a Florida CST return?
CST is reported using Form DR-700016, the Communication Services Tax Return. The return is filed electronically through the Florida DOR’s e-Services portal and is due by the 1st of the month following the close of the reporting period, with a payment deadline of the 20th. The CST return is entirely separate from the DR-15 sales and use tax return; filing one does not satisfy the obligation to file the other. First-time filers must register for a CST account separately from their sales tax registration.
This page is intended for informational purposes and does not constitute legal or tax advice. Businesses with specific CST compliance questions should consult qualified counsel.
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Ribeiro Law is based in Boca Raton, Florida and represents businesses throughout Florida and nationally on sales tax, audit defense, and multistate compliance matters. Consultations are available by phone, video, and in-person.
