Sweden and Finland appeal against EC's planned tax increase on GPS and TV capable cell phones

Back in the middle of December 2008, the European Commission sent out a plan to its member states that suggested that certain types of mobile phones be reclassified as "multi-function devices" for tax purposes. The proposal would have GPS capable phones slapped with a 3.7 percent tax and those capable of mobile TV hit with an staggering 14% tax. The plan also appears to have the potential to target devices with high-quality cameras and those with QWERTY keyboards.

Reuters is reporting that this past Friday, Finland and Sweden appealed against the EC's plans, claiming that it would harm the mobile phone industry and trade relations. It should be pointed out that Finland is home to the world's largest mobile phone manufacturer, Nokia, and that Sony Ericsson joint-venture partner Ericsson is based in Sweden.

According to the governments of Finland and Sweden, the additional taxes would put downward pressure on an already soft mobile phone market, and would possibly bring up issues with the World Trade Organization.

The EC's Customs Code Committee could vote on the plan as early as this week.