26 U.S.C. § 4254 - U.S. Code - Unannotated Title 26. Internal Revenue Code § 4254. Computation of tax

(a) General rule.--If a bill is rendered the taxpayer for local telephone service or toll telephone service--

(b) Where payment is made for toll telephone service in coin-operated telephones.--If the tax imposed by section 4251 with respect to toll telephone service is paid by inserting coins in coin-operated telephones, tax shall be computed to the nearest multiple of 5 cents, except that, where the tax is midway between multiples of 5 cents, the next higher multiple shall apply.

(c) Certain State and local taxes not included.--For purposes of this subchapter, in determining the amounts paid for communications services, there shall not be included the amount of any State or local tax imposed on the furnishing or sale of such services, if the amount of such tax is separately stated in the bill.